Abstract

abstract:

Recent cases of corporate fraud have heightened regulatory interest in leveraging organizational culture to encourage ethical behavior. Policymakers in government and industry wish to use culture to enhance the enforcement-based approaches that they have historically relied on, but they want guidance on how to proceed. In this article, we review the organizational behavior literature on ethical culture. We define the components of ethical culture in organizations and summarize research into how to assess and strengthen it. We demonstrate that assessment must be an integral part of regulatory efforts to strengthen ethical culture, and we recommend that policymakers encourage industries to use standardized, validated measures to further policy goals.

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