Cultural Values and Cognitive Moral Development of Accounting Ethics: A Cross-Cultural Study

Article excerpt

After some significant financial scandals around the world, such as those involving Enron, WorldCom, and Arthur Andersen, various United States bodies have appealed to the public for a greater emphasis on accounting ethics. A wave of discussion involving accounting ethics has taken place (Haas, 2005). Meanwhile, due to the current trend toward globalization of the business environment, accounting ethics can no longer be considered a problem within only a single business or nation. Accounting professionals, as employees of international businesses or international affiliated accounting firms, offer financial information to their stakeholders around the world and facilitate the development of international businesses (McPhail, 1999). As an increasing number of nations with diverse cultural and historical experiences interact in the global economy, the misunderstandings of accounting practices because of different ethical perceptions are magnified. It is a challenge for accounting professionals to understand the differences in perceptions of accounting ethics cross-culturally.

As most accounting students will be future accounting professionals, the impact of culture on accounting students' moral development should be an important topic in accounting ethics education. Related issues have also been studied by a number of researchers (e.g., Thorne, 2000; Tsui, 1996; Venezia, 2005); however, much remains to be learned about how cultural values will influence cognitive moral development. Among the published cross-cultural studies, there are no articles to be found in which the relationship between an individual's cultural values and his/her moral development is examined. Therefore, the purpose in this study was to explore the relationship between cultural values and cognitive moral development of accounting ethics by conducting a cross-cultural comparative analysis of undergraduate accounting students' cognitive moral development in the United States and Taiwan.


Cognitive Moral Development

Kohlberg's (1981) cognitive moral development theory is the most widely used theory in analyzing individuals' moral development. Kohlberg's theory has also been used extensively to examine the levels of moral development of accounting students and professionals (Jones, Massey, & Thorne, 2003). According to Kohlberg's theory, cognitive moral development is the extent to which consideration should ideally be given to resolve an ethical dilemma, and it describes the sophisticated cognitive moral structure that an individual is potentially capable of utilizing (Thorne, 2000). Moral development can be divided into three major levels and six stages: (1) preconventional level (including stage one: obedience and punishment orientation, and stage two: instrumental purpose and exchange); (2) conventional level (including stage three: interpersonal accord and conformity, and stage four: social accord and system maintenance); and (3) postconventional level (including stage five: social contract, utility, individual rights, and stage six: universal ethical principles). Individuals respond differently to ethical issues in accordance with their stage of moral development; those who are at a higher moral stage are more likely to resist the pressure of conforming to the judgments of others.

To measure an individual's cognitive moral development, the Defining Issues Test (DIT) developed by Rest (1979) has traditionally been employed in moral development research (Thorne, 2000). The DIT is a set of ethical dilemmas to which an individual responds, and the total of these responses yields a Principled Score (P-score). The higher the P-score, the higher the stage of ethical judgment development (Rest, 1979). A number of researchers have relied on the DIT to assess moral development of accounting students or professionals (e.g., Earley & Kelly, 2004), and some have employed it in cross-cultural contexts (e. …