Ethics Policies and Gratuity Acceptance by Purchasers

INTRODUCTION The acceptance of gratuities from suppliers is an issue of major concern within the purchasing function. Most purchasing professionals agree that such actions are inappropriate and should be discouraged.(1) The rationale for this view is that even those gratuities given to create legitimate good will may influence the purchasing decision in some way. Therefore, purchasing management needs to be able to control these activities which, in reality, are simply a form of commercial bribery. The purpose of this study was to begin the search for effective methods to achieve this objective. To accomplish this task, the impact of certain individual and organizationally controlled variables on the acceptance of gratuities was examined. THEORETICAL FOUNDATIONS This research was conducted based on the view that ethical decision making is a behavioral phenomenon. This approach has three implications: (1) this behavior may be strengthened or weakened by environmental conditions; (2) it is related to the immediate consequences of a particular decision; and (3) it is also related to stimuli that precede the decision.(2) Although research results discussed in the literature are at times contradictory, there is little doubt that individual personality characteristics play a significant role in the ethical decision-making process. For example, in 1980 one group of researchers found an inverse relationship between purchasing professionals' years of experience and the likelihood they would accept gratuities.(3) On the other hand, another research team found that younger buyers were more likely than their seniors to view gratuities as bribes.(4) While the precise nature of the relationship is far from being fully understood, there is little doubt that personal characteristics influence a purchaser's actions in this regard. Thus, the authors hypothesized that: H1: The personal demographics of the purchaser will have an impact on the acceptance of gratuities. This viewpoint also allows for an examination of the organization's role in individual ethical decision making. Individual moral judgments reflect social group norms as well as individual values. Because the organization represents a meaningful social and moral community for many of its members, its values often are adopted by individual participants in that community.(5) As such, the organization must assume some responsibility for assuring ethical decision making. This responsibility may be reflected in what has been called "organizational concern" by some, and "institutionalized ethics" by others. Organizational concern is the degree of top management's commitment to ethical behavior as perceived by employees. This perception is influenced by the extent of top management's overt ethical behavior and its clear demonstration of an intent to uphold a professional ethical posture.(6) This intent is reflected in the formal or informal ethics policies of the firm.(7) For example, a number of researchers have found that the presence of an explicit organizational policy favoring ethical behavior increased the level of individual ethical behavior.(8) Thus, a second hypothesis developed was: H2: The presence of organizational ethical policies will have an inverse relationship with the acceptance of gratuities by purchasers. The concept of institutionalized ethics is similar to that of organizational concern.(9) According to another team of researchers, institutionalized ethics means formally and explicitly incorporating ethics into daily business life--thus making ethics a regular and normal part of business, including ethics in company policy making, and integrating ethics into the daily decision making and tasks of all employees.(10) However, to be truly institutionalized within the firm, the entire organization must agree to the importance of ethical behavior, and more important, there must be a collective ethical standard for the entire organization to follow. …