Code of ethics for SMEs: substantiating the necessity and willingness to implement in Ukraine
-
DOIhttp://dx.doi.org/10.21511/ppm.16(3).2018.12
-
Article InfoVolume 16 2018, Issue #3, pp. 150-162
- Cited by
- 1187 Views
-
296 Downloads
This work is licensed under a
Creative Commons Attribution 4.0 International License
The article substantiates the necessity of development and implementation of ethical rules of doing business into the business practices of small and medium enterprises. Particular attention is paid to business entities in Ukraine as a country with one of the highest levels of shadow economy. The two-level structure of SMEs’ Code of Ethics designed by the author is being presented, which is based on the following key concepts: transparency of business entities activity, partnership integrity, environmental and social responsibility, which are interrelated and reflected in the individual modules of the Code.
The article presents the results of approbation of the author’s Code of Ethics for SMEs. The approbation is based on a personal and interactive questionnaire about the readiness of Ukrainian SMEs representatives to introduce ethical norms into their activities. The authors determined that Ukrainian SMEs are not well-informed about possible positive effects from following norms and rules in business, in particular, in terms of improving the business climate in the country, increasing the investment attractiveness of the economy as a whole and economic entities in particular, simplifying the access to financial and credit instruments.
The survey and questionnaire of Ukrainian SMEs confirmed the need for the development and implementation of the business Code of Ethics norms, as well as potential demand for it. The respondents recognize the importance of certain international ethical rules in conducting business, which may contribute to attracting investment in Ukraine; however, this is not the only factor affecting the investment attractiveness of domestic business. It is substantiated that the business climate improvement is a complex issue, and the Code of Ethics, in this context, creates the opportunities of guiding and encouraging participants to the active influence on the business environment: to declare zero tolerance to corruption and to form and to maintain clear position in interactions with the public authorities.
- Keywords
-
JEL Classification (Paper profile tab)M13, M14, M21
-
References23
-
Tables1
-
Figures7
-
- Figure 1. Place of Ukraine under the sub-index “Institutions”
- Figure 2. The main modules of the Code of Ethics provision for the SMEs’ behavior
- Figure 3. Structural indicators of answers to questions that determine the urgency of the research
- Figure 4. Structural indicators of answers to questions that determine the possibility of using the results, applying qualitative research methods
- Figure 5. Structural indicators of answers to questions that determine the most commonly used practices of practitioners (SMEs) about the image of the country
- Figure 6. Structural indicators of answers to questions that determine the relevance and significance of the Code modules, %
- Figure 7. Structural indicators of answers to questions that determine the optimistic and pessimistic expectations and alternatives of the respondents, %
-
- Table 1. The list of questions of marketing research on the theme “Necessity of the Code of Ethics implementation for the Management of Small and Medium-Sized Enterprises”
-
- Antoniuk, L., Gernego, Iu., Dyba, V., Polishchuk, Ye., & Sybirianska, Yu. (2017). Barriers and opportunities for hi-tech innovative small and medium enterprises development in the 4th industrial revolution era. Problems and Perspectives in Management, 15(4), 100-113.
- Center for “Corporate Social Responsibility Development” (n.d.).
- EU-UA Civil Society Platform (n.d.).
- Grunig, J. E., & Hunt, T. (1984). Managing public relations. New York, NY: Hilt, Rinehart and Winston.
- Informational internet-platform for SMEs’ innovations supports (n.d.).
- International Forum “Innovation Market” (IFIM) (n.d.).
- Kim Soo-Yeon, & Ki Eyun-Jung (2014). An Exploratory Study of Ethics Codes of Professional Public Relations Associations: Proposing Modified Universal Codes of Ethics in Public Relations. Journal of Mass Media Ethics, 29, 238-257.
- Longenecker, J. G., Moore, C. W., Petty, J. W., Palich, L. E., McKin¬ney, J. A. (2016). Ethical attitudes in small businesses and large corporations: Theory and empirical findings from a tracking study spanning three decades. Journal of Small Business Management, 44(2), 167-183.
- McKinney, J. A, Emerson, T. L., Neubert, M. J. (2010). The effects of ethical codes on ethical perceptions of actions toward stakeholders. Journal of Business Ethics, 97, 505-516.
- National baseline report “Sustainable Development Goals: Ukraine” (2017).
- Non-profit Public Organization “Economists Club” (n.d.).
- Paunov, C. (2016). Corruption’s asymmetric impacts on firm innovation. Journal of Development Economics, 118, 216-231.
- Pieczka, M., L’Etang, J. (2001). Public relations and the question of professionalism. In R. Heath (Ed.), Handbook of public relations (pp. 223-235). Thousand Oaks, CA: Sage.
- Schwartz, M. S. (2001). The nature of the relationship between corporate codes of ethics and behavior. Journal of Business Ethics, 32, 247-262.
- Schwartz, M. S. (2005). Universal moral values for corporate codes of ethics. Journal of Business Ethics, 59(1-2), 27-44.
- Selçuk, U., Spence, L., Simpson, R., & Karakas, F. (2017). Work ethic, religion and moral energy: the case of Turkish SME owner-managers. The International Journal of Human Resource Management, 4(28), 1212-1235.
- Sharma, T., & Dudeja, M. (2013). Business ethics in SMEs: an empirical study of selected units of Haryana. International Journal of Indian Culture and Business Management, 7(3), 307-323.
- The Union of Enterepreneurs of Small, Middle-Sized and Privatized Enterprises (n.d.).
- Tilley, E. (2015). The ethics pyramid: Making ethics unavoidable in the public relations process. Journal of Mass Media Ethics, 20(4), 305- 320.
- Vyakarnam, R., Bailey, A., Myers, A., & Burnett, D. (1997). Towards an understanding of ethical behavior in small firms. Journal of Business Ethics, 16, 1625-1636.
- Wiley, C. (2000). Ethical standards for human resource management professionals: A comparative analysis of five major codes. Journal of Business Ethics, 25(2), 93-114.
- World Economic Forum The Global Competitiveness Report (2017–2018) (n.d.).
- Xu, G., & Yano, G. (2017). How does anti-corruption affect corporate innovation? Evidence from recent anti-corruption efforts in China. Journal of Comparative Economics, 45(3), 498-519.