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Legitimacy and Institutionalization of Code of Conduct: The Management of Business Ethics

Research on Professional Responsibility and Ethics in Accounting

ISBN: 978-1-78754-973-9, eISBN: 978-1-78754-972-2

Publication date: 3 May 2018

Abstract

The chapter first draws concepts underlying legitimacy theory (Suchman, 1995) to provide a basis to understand alternative approaches to the development of ethical cultures in global organization. The chapter then illustrates the institutionalization of Codes of Ethics through a “management” approach drawing from Simon’s Levers of Control as a framework to contextualize experiences of a large global conglomerate. The chapter adopts the case approach, applying the case of the Tata Group to highlight the integration of external institutions into the institutionalization process. The management of business ethics (MBE) can provide a basis to institutionalize ethics in global firms to create an internal culture consistent with ethical goals of the corporations that may also be different from the external environment. The MBE includes the application of managerial techniques and information technology to institutionalize ethics in organizational culture. Management Accountants can have a significant role in supporting this endeavor, given their expertise in measurement and control. The code is only one aspect through which firms develop their identity. Information on the case was unevenly distributed. For example, there was voluminous information on the code and its implementation. Therefore, some subjectivity was necessary in selecting relevant items. The chapter, to my knowledge, provides unique insights into the theoretical and practical aspects of institutionalizing ethics in corporate cultures using Codes of Ethics.

Keywords

Citation

Joseph, G. and Hashmi, A. (2018), "Legitimacy and Institutionalization of Code of Conduct: The Management of Business Ethics", Jefrey, C. (Ed.) Research on Professional Responsibility and Ethics in Accounting (Research on Professional Responsibility and Ethics in Accounting, Vol. 21), Emerald Publishing Limited, Bingley, pp. 53-82. https://doi.org/10.1108/S1574-076520180000021003

Publisher

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Emerald Publishing Limited

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