An Empirical Study of the Relationships between Business Ethics and Corporate Performance

During the past two decades, business ethics became an important element for stakeholders’ to evaluate a firm’s integrity. Incidents like Enron and WorldCom have made stakeholders and investors pay much attention on the importance of corporate business ethics. 　　The first purpose of this study is to investigate the impacts of awareness of business ethics and ability of implementing business ethics on outcomes of ethical practices. Second purpose of this study is to examine the relationships between outcomes of ethical practices and corporate performance. 　　Data were collected from foreign enterprises in Taiwan, which is grouped into Japan, Europe, and United States, by using mail and Internet questionnaires. Total of 114 questionnaires are valid. Regression analysis of the results indicate that (1) ability of implanting business ethics especially reward systems and training programs has significant impact on outcomes of ethical practices, and (2) outcomes of ethical practices is significantly influenced corporate growth in sales, financial performance, and overall satisfaction. Awareness of business ethics does not have significant impact on outcomes of ethical practices. Some explanations as well as limited generalizations and implication are developed.