Academic journal article Journal of Small Business Management

The Ethical Outlook of Micro Business Operators

Academic journal article Journal of Small Business Management

The Ethical Outlook of Micro Business Operators

Article excerpt

This paper reports the findings of an investigation into the ethical outlook of micro business operators. The study was conducted in Australia and is the first such examination of ethical perspectives in this segment of the business population. Micro business is internationally recognizable, economically significant, and strongly entrepreneurial, and it has a high level of control over the values it enacts. The study indicates that ethical considerations are important to Australian micro business operators. While no one single ethical perspective was dominant, nonreligious beliefs and principles were found to be the most important determinant of their ethical values. Some variation was discovered in operator attitudes based on age, gender, and education.


The importance of ethical behavior in business operations has been emphasized in recent work (De George 1999). Although there has been a growth in the study of ethical issues in the general business environment, there has been relatively little attention paid to these questions in the small business sector (Quinn 1997; Spence 1999). While an extensive international literature search disclosed a small number of studies that addressed ethical issues in small business, the search located no investigations into ethics in micro business. It was therefore considered important to initiate the study of ethics in this area, as almost four out of every five businesses in Australia are micro businesses and micro business forms a substantial part of the small business sector in all countries. It is economically significant and strongly entrepreneurial, and its operators exercise a high level of control over the values their businesses enact.

The first objective of the present study was to examine the relative importance of different ethical perspectives in running a business. No previous work has attempted to determine which ethical perspectives most closely reflect the values of these business operators. The second objective was to explore micro business owners' views about key small business issues from an ethical standpoint. Concentrating on micro business permitted a highly focused study that avoided the problem of generalizing about small business when accepted definitions of small range between zero and 500 employees (Spence 1999).

While international definitions of a micro business admit some variation (Bridge, O'Neill, and Cromie 1998; Cameron and Massey 1999), this study used the accepted Australian definition of a business that is independently owned or operated and is either nonemploying or employs less than five people (ABS 1997-98; MBCG 1998). Micro businesses are a vital part of the economy and comprise almost 85 percent of all Australian nonagricultural small business (ABS 1998). Overall, small business produces approximately one-third of gross domestic product and accounts for just over half of total private sector nonagricultural employment in Australia (Department of Employment, Workplace Relations, and Small Business 1999).

The entrepreneurial nature of micro business is reflected in its diversity. Many micro businesses are highly sophisticated and include software developers, doctors, architects, and other professionals, as well as businesses in the property financial, and business services sector (MBCG 1998). The creative, holistic, and food industries also are well represented (Gabogrecan 1998). Further, micro business operators exercise a high level of personal control over their businesses. As Vyakarnam et al. (1997) observe with respect to small business generally, personal ethics and business ethics are likely to be closely aligned in this situation.

Ethical Perspectives and Entrepreneurial Behavior

The business ethics literature identifies four dominant ethical perspectives: idealist, utilitarian, deontological, and virtue ethics. …

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