IDEAS home Printed from https://ideas.repec.org/a/kap/ejlwec/v35y2013i2p295-312.html
   My bibliography  Save this article

CEO qualities and codes of ethics

Author

Listed:
  • Isabel-María García-Sánchez
  • Luis Rodríguez-Domínguez
  • Isabel Gallego-Álvarez

Abstract

Ethical issues have received growing attention recently, after corporate scandals and during the current economic crisis. Several initiatives have been adopted to restore confidence and trust in businesses, such as ethics codes. In addition, as a result of those scandals and financial frauds, several rules have focused on the role played by Boards of Directors in the planning and monitoring of codes of ethics. However, the empirical evidence is still scarce and needs some degree of extension. The purpose of this study is to determine the influence of several corporate governance features—particularly, the Chief Executive Officer (CEO)—on the decision of developing an ethics code, among Spanish companies. Our main findings point out the lack of influence of the CEO’s characteristics (except for CEO reputation) on the likelihood of having a corporate code, indicating that this decision has to do with a choice made by the company overall, perhaps because of regulatory reasons or stakeholders’ expectations. Also, we have checked how other variables, such as the extent of a firm’s participation in defence or other government contracts or multiple listings of the company in different financial markets, can influence the decision of developing an ethics code. Copyright Springer Science+Business Media, LLC 2013

Suggested Citation

  • Isabel-María García-Sánchez & Luis Rodríguez-Domínguez & Isabel Gallego-Álvarez, 2013. "CEO qualities and codes of ethics," European Journal of Law and Economics, Springer, vol. 35(2), pages 295-312, April.
    • Handle: RePEc:kap:ejlwec:v:35:y:2013:i:2:p:295-312
    DOI: 10.1007/s10657-011-9248-5
    as

    Download full text from publisher

    File URL: http://hdl.handle.net/10.1007/s10657-011-9248-5
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1007/s10657-011-9248-5?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Haniffa, R.M. & Cooke, T.E., 2005. "The impact of culture and governance on corporate social reporting," Journal of Accounting and Public Policy, Elsevier, vol. 24(5), pages 391-430.
    2. Craig Crossland & Donald C. Hambrick, 2007. "How national systems differ in their constraints on corporate executives: a study of CEO effects in three countries," Strategic Management Journal, Wiley Blackwell, vol. 28(8), pages 767-789, August.
    3. Heather Canary & Marianne Jennings, 2008. "Principles and Influence in Codes of Ethics: A Centering Resonance Analysis Comparing Pre- and Post-Sarbanes-Oxley Codes of Ethics," Journal of Business Ethics, Springer, vol. 80(2), pages 263-278, June.
    4. Brickley, James A. & Linck, James S. & Coles, Jeffrey L., 1999. "What happens to CEOs after they retire? New evidence on career concerns, horizon problems, and CEO incentives," Journal of Financial Economics, Elsevier, vol. 52(3), pages 341-377, June.
    5. Bernadette Loacker & Sara Muhr, 2009. "How Can I Become a Responsible Subject? Towards a Practice-Based Ethics of Responsiveness," Journal of Business Ethics, Springer, vol. 90(2), pages 265-277, December.
    6. Ennio Lugli & Ulpiana Kocollari & Chiara Nigrisoli, 2009. "The Codes of Ethics of S&P/MIB Italian Companies: An Investigation of Their Contents and the Main Factors that Influence Their Adoption," Journal of Business Ethics, Springer, vol. 84(1), pages 33-45, January.
    7. Mark S. Schwartz, 2002. "A Code of Ethics for Corporate Code of Ethics," Journal of Business Ethics, Springer, vol. 41(1), pages 27-43, November.
    8. Brad Long & Cathy Driscoll, 2008. "Codes of Ethics and the Pursuit of Organizational Legitimacy: Theoretical and Empirical Contributions," Journal of Business Ethics, Springer, vol. 77(2), pages 173-189, January.
    9. Betsy Stevens, 2008. "Corporate Ethical Codes: Effective Instruments For Influencing Behavior," Journal of Business Ethics, Springer, vol. 78(4), pages 601-609, April.
    10. Anil Shivdasani & David Yermack, 1999. "CEO Involvement in the Selection of New Board Members: An Empirical Analysis," Journal of Finance, American Finance Association, vol. 54(5), pages 1829-1853, October.
    11. Brickley, James A. & Coles, Jeffrey L. & Jarrell, Gregg, 1997. "Leadership structure: Separating the CEO and Chairman of the Board," Journal of Corporate Finance, Elsevier, vol. 3(3), pages 189-220, June.
    12. Luis Rodriguez-Dominguez & Isabel Gallego-Alvarez & Isabel Garcia-Sanchez, 2009. "Corporate Governance and Codes of Ethics," Journal of Business Ethics, Springer, vol. 90(2), pages 187-202, December.
    13. Geoffrey C. Kiel & Gavin J. Nicholson, 2005. "Evaluating Boards and Directors," Corporate Governance: An International Review, Wiley Blackwell, vol. 13(5), pages 613-631, September.
    14. Core, John E. & Holthausen, Robert W. & Larcker, David F., 1999. "Corporate governance, chief executive officer compensation, and firm performance," Journal of Financial Economics, Elsevier, vol. 51(3), pages 371-406, March.
    15. Muel Kaptein & Mark Schwartz, 2008. "The Effectiveness of Business Codes: A Critical Examination of Existing Studies and the Development of an Integrated Research Model," Journal of Business Ethics, Springer, vol. 77(2), pages 111-127, January.
    16. Eyun-Jung Ki & Soo-Yeon Kim, 2010. "Ethics Statements of Public Relations Firms: What Do They Say?," Journal of Business Ethics, Springer, vol. 91(2), pages 223-236, January.
    17. Edward J. Zajac, 1990. "Ceo selection, succession, compensation and firm performance: A theoretical integration and empirical analysis," Strategic Management Journal, Wiley Blackwell, vol. 11(3), pages 217-230, March.
    18. Fama, Eugene F & Jensen, Michael C, 1983. "Separation of Ownership and Control," Journal of Law and Economics, University of Chicago Press, vol. 26(2), pages 301-325, June.
    19. Kaplan, Steven N. & Reishus, David, 1990. "Outside directorships and corporate performance," Journal of Financial Economics, Elsevier, vol. 27(2), pages 389-410, October.
    20. Sven Helin & Johan Sandström, 2007. "An Inquiry into the Study of Corporate Codes of Ethics," Journal of Business Ethics, Springer, vol. 75(3), pages 253-271, October.
    21. Brian K. Boyd, 1995. "CEO duality and firm performance: A contingency model," Strategic Management Journal, Wiley Blackwell, vol. 16(4), pages 301-312.
    22. Ingrid Bonn & Josie Fisher, 2005. "Corporate Governance and Business Ethics: insights from the strategic planning experience," Corporate Governance: An International Review, Wiley Blackwell, vol. 13(6), pages 730-738, November.
    23. David A. Waldman & Donald S. Siegel & Mansour Javidan, 2006. "Components of CEO Transformational Leadership and Corporate Social Responsibility," Journal of Management Studies, Wiley Blackwell, vol. 43(8), pages 1703-1725, December.
    24. Ian Jones & Michael Pollitt, 1999. "The Development of Ethical Issues Facing Boards of Directors: A Model with Implications," Working Papers wp151, Centre for Business Research, University of Cambridge.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Elisa Baraibar-Diez & María D Odriozola & José Luis Fernández Sánchez, 2016. "Transparency through European corporate governance codes," International Journal of Disclosure and Governance, Palgrave Macmillan, vol. 13(3), pages 244-261, August.
    2. Bieszk-Stolorz Beata & Markowicz Iwona, 2014. "Economical Activity Of The Polish Population," Folia Oeconomica Stetinensia, Sciendo, vol. 14(2), pages 198-210, December.
    3. Maira Babri & Bruce Davidson & Sven Helin, 2021. "An Updated Inquiry into the Study of Corporate Codes of Ethics: 2005–2016," Journal of Business Ethics, Springer, vol. 168(1), pages 71-108, January.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Luis Rodriguez-Dominguez & Isabel Gallego-Alvarez & Isabel Garcia-Sanchez, 2009. "Corporate Governance and Codes of Ethics," Journal of Business Ethics, Springer, vol. 90(2), pages 187-202, December.
    2. Maira Babri & Bruce Davidson & Sven Helin, 2021. "An Updated Inquiry into the Study of Corporate Codes of Ethics: 2005–2016," Journal of Business Ethics, Springer, vol. 168(1), pages 71-108, January.
    3. Jingoo Kang, 2016. "Labor market evaluation versus legacy conservation: What factors determine retiring CEOs' decisions about long-term investment?," Strategic Management Journal, Wiley Blackwell, vol. 37(2), pages 389-405, February.
    4. Rasha Ashraf & Rajesh Chakrabarti & Richard Fu & Narayanan Jayaraman, 2010. "Takeover Immunity, Takeovers, and the Market for Nonexecutive Directors," Financial Management, Financial Management Association International, vol. 39(1), pages 83-127, March.
    5. Carla Messikomer & Carol Cirka, 2010. "Constructing a Code of Ethics: An Experiential Case of a National Professional Organization," Journal of Business Ethics, Springer, vol. 95(1), pages 55-71, August.
    6. Jiraporn, Pornsit & Kim, Young Sang & Davidson III, Wallace N., 2008. "Multiple directorships and corporate diversification," Journal of Empirical Finance, Elsevier, vol. 15(3), pages 418-435, June.
    7. Giovanni Garegnani & Emilia Merlotti & Angeloantonio Russo, 2015. "Scoring Firms’ Codes of Ethics: An Explorative Study of Quality Drivers," Journal of Business Ethics, Springer, vol. 126(4), pages 541-557, February.
    8. Lisa Fairchild & Joanne Li, 2005. "Director Quality and Firm Performance," The Financial Review, Eastern Finance Association, vol. 40(2), pages 257-279, May.
    9. Catarina Fernandes & Jorge Farinha & Francisco Vitorino Martins & Cesario Mateus, 2017. "Supervisory boards, financial crisis and bank performance: do board characteristics matter?," Journal of Banking Regulation, Palgrave Macmillan, vol. 18(4), pages 310-337, November.
    10. Ferris, Stephen P. & Jayaraman, Narayanan & Liao, Min-Yu (Stella), 2020. "Better directors or distracted directors? An international analysis of busy boards," Global Finance Journal, Elsevier, vol. 44(C).
    11. Vitolla, Filippo & Raimo, Nicola & Rubino, Michele & Garegnani, Giovanni Maria, 2021. "Do cultural differences impact ethical issues? Exploring the relationship between national culture and quality of code of ethics," Journal of International Management, Elsevier, vol. 27(1).
    12. Masulis, Ronald W. & Mobbs, Shawn, 2014. "Independent director incentives: Where do talented directors spend their limited time and energy?," Journal of Financial Economics, Elsevier, vol. 111(2), pages 406-429.
    13. Muel Kaptein, 2011. "Toward Effective Codes: Testing the Relationship with Unethical Behavior," Journal of Business Ethics, Springer, vol. 99(2), pages 233-251, March.
    14. Bar-Hava, K. & Gu, F. & Lev, B., 2013. "The virtues of fewer directorships," Research Memorandum 037, Maastricht University, Graduate School of Business and Economics (GSBE).
    15. Isabel-María García-Sánchez, 2010. "The effectiveness of corporate governance: board structure and business technical efficiency in Spain," Central European Journal of Operations Research, Springer;Slovak Society for Operations Research;Hungarian Operational Research Society;Czech Society for Operations Research;Österr. Gesellschaft für Operations Research (ÖGOR);Slovenian Society Informatika - Section for Operational Research;Croatian Operational Research Society, vol. 18(3), pages 311-339, September.
    16. Kaptein, S.P., 2009. "From Symbolic to Substantive Documents: When Business Codes of Ethics Impact Unethical Behavior in the Workplace," ERIM Report Series Research in Management ERS-2009-021-ORG, Erasmus Research Institute of Management (ERIM), ERIM is the joint research institute of the Rotterdam School of Management, Erasmus University and the Erasmus School of Economics (ESE) at Erasmus University Rotterdam.
    17. Jiraporn, Pornsit & Singh, Manohar & Lee, Chun I., 2009. "Ineffective corporate governance: Director busyness and board committee memberships," Journal of Banking & Finance, Elsevier, vol. 33(5), pages 819-828, May.
    18. Tutun Mukherjee & Som Sankar Sen, 2022. "Impact of CEO attributes on corporate reputation, financial performance, and corporate sustainable growth: evidence from India," Financial Innovation, Springer;Southwestern University of Finance and Economics, vol. 8(1), pages 1-50, December.
    19. McKnight, Phillip J. & Weir, Charlie, 2009. "Agency costs, corporate governance mechanisms and ownership structure in large UK publicly quoted companies: A panel data analysis," The Quarterly Review of Economics and Finance, Elsevier, vol. 49(2), pages 139-158, May.
    20. Al Dah, Bilal & Michael, Amir & Dixon, Rob, 2017. "Antitakeover provisions and CEO monetary benefits: Revisiting the E-index," Research in International Business and Finance, Elsevier, vol. 42(C), pages 992-1004.

    More about this item

    Keywords

    Boards of directors; CEO characteristics; Codes of ethics; Corporate governance; Chief Executive Officer (CEO); M14; M48;
    All these keywords.

    JEL classification:

    • M14 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - Corporate Culture; Diversity; Social Responsibility
    • M48 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - Government Policy and Regulation

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:kap:ejlwec:v:35:y:2013:i:2:p:295-312. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: http://www.springer.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.