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Journal of Business Ethics

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01-03-2013

Sins of the Father’s Firm: Exploring Responses to Inherited Ethical Dilemmas in Family Business

Authors: Reginald A. Litz, Nick Turner

Published in: Journal of Business Ethics | Issue 2/2013

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Abstract

How do individuals respond when they perceive that their family business has been built upon unethical business conduct? Drawing on an expanded version of Hirschman’s typology of generic responses to declining situations (Exit, Voice and Loyalty: Responses to Decline in Firms, Organizations, and States, Harvard University Press, Cambridge, MA, 1970), which includes responses of Exit, Voice, Loyalty, and Neglect, we offer a model that predicts probability of intended response behavior as a function of normative obligation (i.e., what one perceives ought to be done), managerial discretion (i.e., what one perceives can be done), and successor commitment to the firm. The model is tested on 124 business school students exposed to a scenario depicting an inherited ethical dilemma occurring in a family business from Arthur Miller’s play All My Sons, and shows support for elements of the proposed framework. Most notable is a significant negative relationship between normative firm-directed commitment and the response of Neglect.

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A copy of the evaluation instrument is available upon request from the first author.

Our thanks to one of the manuscript’s reviewers for this observation.

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Title: Sins of the Father’s Firm: Exploring Responses to Inherited Ethical Dilemmas in Family Business
Authors: Reginald A. Litz
Nick Turner
Publication date: 01-03-2013
Publisher: Springer Netherlands
Published in: Journal of Business Ethics / Issue 2/2013
Print ISSN: 0167-4544
Electronic ISSN: 1573-0697
DOI: https://doi.org/10.1007/s10551-012-1305-7

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