National cultures and business ethics

38 Second, ethical decision-making is demarcated as a distinct category of decision-making, and ethical behaviour is viewed as a specific type of behaviour (for more behavior categories, see also Kish-Gephart et al. 2010), as if they were distinguishable from other types of behaviour and decision-making. What I argue, in contrast, is that the ethical is inherent in all actions and decisions. We thus need to explore where and how ‘the ethical’ penetrates social life, including the social life of organizations and even the most ordinary situations.

Third, while I find the definitions of the ethical as context-dependent insightful, within quantitative studies, this context is defined as a statistical average of respondents’ answers that can be captured, measured and held stable as a variable. The downside of such studies is that we risk losing important insights about the complexities and different aspects of these contexts. The present dissertation intends to contribute to expanding this area of research by providing an ethnographic perspective on ethical decision-making as an immanent part of everyday action, and it explores ethical judgments as they unfold in everyday practice.

39 differences are often conceptualized as cultural differences, and to overcome these, skills within ‘cross-cultural management’ are proposed as the solution (cf. Søderberg and Holden 2002).

The cross-cultural management approach operates on an assumption of ‘cultures’ as distinct, reasonably stable units across which one can manage (or fail to do so). Indeed, most studies within cross-cultural management are also based on assumptions that cultures have an ‘essence’ and can therefore be demarcated, measured and compared (Mahadevan 2017; Søderberg and Holden 2002). In this approach, cultures are understood as a system of values that is tied to a national belonging

(Romani, Barmeyer, et al. 2018:247–49; Sackmann et al. 1997; Sackmann and Phillips 2004).

Underscoring this conflation of culture with nations is the fact that cross-cultural management as a theme is highly prevalent within international human resources management and international business studies (see e.g. Bird and Mendenhall 2016). The assumption is that culture and the national are inseparable.

Within this body of literature, several studies have focused on ‘cultural intelligence’, referring to the ability to adapt to different (national) cultural environments (see e.g. Blasco, Feldt, and Jakobsen 2012) and on ‘bi-culturals’ (Brannen and Thomas 2010; Hanek, Lee, and Brannen 2014), or ‘multiculturals’

(Fitzsimmons, Miska, and Stahl 2011; Nguyen and Benet-Martínez 2010), all of which are terms used to refer to individuals with two or more national identities, but these labels are rarely used to account for belonging to other forms of cultural communities.

Almost inevitable within cross-cultural management studies is the seminal work of Geert Hofstede (see e.g. 2001) who created quantifiable dimensions for comparing essentialist cultural traits and for

understanding cross-cultural management challenges. The fact that Hofstede found values differences across employees in one company, IBM, became an argument that these differences represented ideal types of national cultural differences. Despite significant criticism, Hofstede’s ‘cultural dimensions’ are used across a wide array of disciplines (Phillips and Sackmann 2015:11).

The highly cited Global Leadership and Organizational Behaviour Effectiveness (GLOBE) research program (House et al. 2004) has continued the work of Hofstede by drawing on similar dimensions for measuring culture and by equating ‘culture’ with national culture (see e.g. Koopman, Den Hartog, and Konrad 1999). The GLOBE study begun in 1993 and was extended in 2004, 2007 and again in 2014, and yet another phase of the study is currently being initiated⁵, all of which illustrates that this view of essentialist national culture continues to be prevalent.

5 https://globeproject.com/studies, accessed July 1^st, 2019.

40 As pointed out by Søderberg and Holden (2002), cross-cultural management needs to consider the interaction of ‘multiple cultures’ rather than simply cultures at national boundaries (see also Sackmann et al. 1997; Sackmann and Phillips 2004).

Within social anthropology, the concept of culture has long been debated, and in the early 1990s, there was a rupture in conceptualizing culture in terms of essentialist or place-bound frameworks (see e.g.

Hannerz 1992; Malkki 1992; Olwig and Hastrup 1997; Rosaldo 1988). Further, concepts of

‘multiculturalism’ and ‘subcultures’ were criticized for attempting to subsume the plurality of human practices into essentialist and demarcated cultures. Metaphors such as ‘cultural mosaics’ were criticized for replicating notions of cultures as internally homogeneous ‘pieces’ of one kind and with clear

boundaries (see e.g. the critique by Gupta and Ferguson 1992; Schwartz 1997). Since then, the concept of culture as a metaphor has moved out of focus within the discipline.

Despite attempts by some scholars (see e.g. Mahadevan 2017; Moore 2005; Sackmann et al. 1997;

Søderberg and Holden 2002), a similar break with the culture concept and its association with territory and national borders is yet to be seen within international business research. As argued by Moore (2015b), the reason for the high degree of scholarly focus on national culture may be that managers largely conceptualize their cross-border operations in national terms, and that these emic concepts have been adopted by international business scholars. Moreover, Phillips and Sackmann (2015) argue that the fact that Hofstede, in his work, equated national belonging with culture created a precedent within cross-cultural management as a field of research as well as among practitioners (Phillips and Sackmann 2015:12).

Within this dissertation, I also take a point of departure in the prevalent focus on national culture as a means of understanding local interpretations of Ferring’s ethics program, but I also pursue a different road into the study of complex organizations and explore complexity and difference along multiple and more fluid demarcation lines in order to understand whether there are other communities that deserve attention in studies of business ethics. These communities turn out to be vocational groups and groups within the organizational hierarchy. I will elaborate on this later in this chapter.

2.5.2. Comparative business ethics

Conceptualizing national culture as a primary differentiator and central factor for management is also found within business ethics research. This stream of literature is often referred to as ‘comparative business ethics’, and the aim is to compare business ethics practices and perceptions across countries

41 and national business systems (see e.g. Choi et al. 2010). Within this stream of literature, scholars have developed instruments such as the ‘International Business Ethics Index’ for comparing consumers’

sentiments towards business ethics in different national cultures (Tsalikis and Seaton 2007; Tsalikis, Seaton, and Li 2008) and the ‘Attitudes Towards Business Ethics Questionnaire’ (ATBEQ) which

investigates ‘cross-cultural differences in business ethics’ within different country contexts (Preble and Reichel 1988; Sims 2006:101). These scholars thus engage in the same conceptual conflation of culture and nation as described earlier (see also Bageac, Furrer, and Reynaud 2011; Sims and Gegez 2004).

Other scholars have sought to correlate Hofstede’s culture dimensions with ‘ethics’ such as the content of companies’ ethics policies and ethical conduct (as defined by the researchers) in quantitative data analytics models, where ethics and culture are treated as variables (Scholtens and Dam 2007:280).

These studies show that understandings of ethics are indeed contextual, as also argued in the ‘ethical decision-making’ literature, and that understandings vary considerably across national cultures.

However, these studies operate with the same narrow focus on national cultures as does the

aforementioned cross-cultural management literature. Moreover, with the amount of national culture-focused comparative business ethics studies in mind, it seems that the national context is almost by default defined as the most salient cultural context worth exploring in business ethics research.

Whereas most comparative business ethics research relies on quantitative methodology, there exist a small number of qualitative studies. These explore the challenges of introducing codes of ethics and codes of conduct⁶ from Western to non-Western contexts (Hanson and Rothlin 2010; Helin and Babri 2015; Helin and Sandström 2008, 2010; Hoivik 2007; Jensen, Sandström, and Helin 2015; Nakhle and Davoine 2016).

Perhaps due to the qualitative methodological design, which uses less predefined response schemas than quantitative surveys, we find that the message of these qualitative studies on codes of ethics is that codes are not merely ‘implemented’ in new contexts. Rather, in exporting a code into a new context, numerous agents participate in bringing this code into organizational life, thus creating varying outcomes.

The receivers of codes of ethics, then, are not merely passive recipients. They are active interpreters and possible change agents who mould the meaning, outcome and even the importance of codes through their interaction with these codes. Thus, recent research on codes of ethics demonstrates no a

6 Codes of conduct are generally more compliance-focused than are codes of ethics, but as ethics and compliance departments are often combined within companies, and due to the scarcity of relevant studies, I have also included studies on codes of conduct in this literature review.

42 priori hierarchical relationship between those introducing the code, the code itself and those on whom the code is imposed. Moreover, as demonstrated by Jensen, Sandström and Helin (2009), the code itself also has transformative capacities.

Together, such insights on complex processes and heterogeneous outcomes of introducing a code of ethics in different contexts are important learning points for companies seeking to ensure adherence to codes of ethics. Furthermore, these insights may perhaps even be part of the reason why the

quantitative studies have had more inconclusive results regarding the ‘effectiveness’ of codes (Erwin 2011; Kaptein and Schwartz 2008; Mcdonald 2009; Singh et al. 2018).

The qualitative studies thus provide us with valuable knowledge about the different ways in which codes of ethics are interpreted by employees. However, although some of these studies challenge Hofstedian notions of foreignness and distance and static cultural categories, they continue to operate with a focus on national culture. Thus, these studies have been designed to explore country differences rather than differences among other potential cultural communities. The studies thus follow ways in which corporations often conceive of their own structures as divided into headquarters and foreign subsidiaries. However, we could also conceive of internal firm diversity in different ways; e.g. in terms of organizational processes; or by type of firm, such as a production company supplying other

companies, a distribution company without any development of own solutions, a research-focused company, or an end-to-end solutions provider. In the latter case, one might find that the trait of being

‘multi-vocational’ is equally - or perhaps more - salient than the ‘multi-national’ for how ethics programs and codes of ethics are received.

In this dissertation, I will show how a corporate ethics program is introduced into contexts that are both multi-national and multi-vocational. As mentioned earlier, I use the term multi-vocational rather than multi-professional to point to the importance not only of professional background (e.g., doctor or pharmacist) but also the communities that are established through particular vocational practices in specific work contexts. I will approach business ethics in a more contextually sensitive manner than previous studies where the recipients of ethics programs are not merely passive receivers but also contributors to co-constructing notions of right and wrong.

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