Whistleblowing: Factors That Contribute to Management Accountants Reporting Questionable Dilemmas: Whistleblowing Has Become an Important Issue for Management Accountants Today. This Article Explores the Reasons Management Accountants May Choose to Blow the Whistle for Three Different Materiality Levels

Article excerpt

Transparency in financial reporting is the mantra of the day, but the means to that transparency remains elusive. One element of transparency is the discovery of unethical situations and reporting the wrongs in the corporate environment. Accounting professionals are exposed to ethical dilemmas on a regular basis and have the opportunity to uncover wrongdoing, possibly even before the effects are so disastrous that a company's viability is in question.

James R. Rest proposes a four-stage model of the ethical decision-making process. The first stage is moral issue recognition, followed by moral evaluation/ judgment, moral intention, and moral behavior. (1) Thomas Jones's studies of cognitive development suggest that the vividness of the moral dilemma enhances the recognition of a moral issue. (2) After recognition, individuals must make a moral evaluation or judgment. Moral evaluation leads to moral intention, (3) and moral intention leads to moral behavior. (4) The model of ethical decision making is complicated, as indicated by multiple variations of similar models. Therefore, in evaluating a survey participant's beliefs about ethical behavior, we explore ethical decision making using the Multidimensional Ethics Scale (MES) to evaluate ethical dilemmas.

THE MES SCALE

The Multidimensional Ethics Scale is used to elicit a moral evaluation of each potentially unethical situation within the philosophical constructs of justice, deontology, utilitarianism, relativism, egoism, and compassion. In following Rest's model, our study asks each participant to evaluate whether an action is ethical or not and what his or her attitudes are about each action. Individuals often balance several philosophical values when facing an ethics decision.

The philosophical view of justice is rooted in one's belief that everyone should be treated equitably, but there have been numerous philosophers who have offered interpretations of justice in relation to conformity with law, differing cultures, and political environments. The philosophical view of deontology identifies a contractual obligation; an action is right only if it is consistent within a set of moral rules and wrong only if it violates those rules. Utilitarian actions are those believed to be performed for the greatest good of all. Relativism recognizes certain rules to be acceptable in one culture and unacceptable in another, indicating that there are no universal moral standards over all people. For the purpose of this study, we consider the components of one's society as the impact of family, tradition, culture, and his or her profession. The philosophical view of egoism promotes an individual's personal longterm interests above corporate interests and others. The philosophical view of compassion comes from concern and empathy for others.

Most studies utilizing the MES have found that many of these factors influence ethical decisions. (5) Therefore, we propose hypothesis H1 (with several subparts):

* H1a--Accounting professionals will identify the philosophical factor of justice as a reason an action is considered unethical.

* H1b--Accounting professionals will identify the philosophical factor of relativism as a reason an action is considered unethical.

* H1c--Accounting professionals will identify the philosophical factor of egoism as a reason an action is considered unethical.

* H1d--Accounting professionals will identify the philosophical factor of utilitarianism as a reason an action is considered unethical.

* H1e--Accounting professionals will identify the philosophical factor of deontology as a reason an action is considered unethical.

* H1f--Accounting professionals will identify the philosophical factor of compassion as a reason an action is considered unethical.

Literature about Whistleblowing

Whistleblowing is defined as "the disclosure by organization members (former or current) of illegal, immoral, or illegitimate practices under the control of their employers, to persons or organizations that may be able to effect action. …