Title
Do Competitive Environments Lead to the Rise and Spread of Unethical Behavior? Parallels from Enron
Document Type
Article
Department or Administrative Unit
Management
Publication Date
1-23-2008
Abstract
While top-down descriptors have received much attention in explaining corruption, we develop a grassroots model to describe structural factors that may influence the emergence and spread of an individual’s (un)ethical behavior within organizations. We begin with a discussion of the economics justification of the benefits of competition, a rationale used by firms to adopt structural aides such as the ‹stacking’ practice that was implemented at Enron. We discuss and develop an individual-level theory of planned behavior, then extend it to the dyadic level in an internally competitive organization, and finally extend the dyadic model to the social network. We apply social network theory to predict favorable and unfavorable conditions for the emergence and diffusion of an intraorganizational instance of unethical behavior and find that network conditions favoring the suppression of the emergence of unethical behavior also promote its diffusion. For illustrative purposes, we utilize examples from Enron’s internally competitive structure to embed our arguments in a real world context and bring reality to our theorizing. Implications for both researchers and managers are discussed.
Recommended Citation
Kulik, B. W., O’Fallon, M. J., & Salimath, M. S. (2008). Do Competitive Environments Lead to the Rise and Spread of Unethical Behavior? Parallels from Enron. Journal of Business Ethics, 83(4), 703–723. https://doi.org/10.1007/s10551-007-9659-y
Journal
Journal of Business Ethics
Rights
© Springer 2008
Comments
This article was originally published in Journal of Business Ethics. The full-text article from the publisher can be found here.
Due to copyright restrictions, this article is not available for free download from ScholarWorks @ CWU.