Does Organizational Injustice Lead to Unethical Behavior in Workplace? The
Moderating Effect of Guanxi
Ya-li Tan
1
Department of Political Education, Huazhong University of Science and Technology, Wuhan, China
(tanyali@mail.hust.edu.cn)
Abstract - This study examines the relationship between
distributive injustice and unethical behavioral intention in
workplace under Chinese culture background. According to
literatures of organizational injustice, unethical behavior
and guanxi, we hypothesize that distributive injustice will
positively relate to unethical behavioral intention of
individuals, and guanxi status of individuals will play a
moderating role in the relationship. Study results generally
supported our hypotheses listed above. Firstly, level of
perceived injustice was positively predicted individuals’
unethical behavioral intention. Secondly, the positive
relationship of injustice and unethical behavioral intention
was reinforced when individuals maintained estranged
guanxi status to the leader in organizations.
Keywords - Unethical behavior, distributive injustice,
guanxi
I. INTRODUCTION
As the accounting scandals of Enron was disclosed at
the beginning of this century, the role of business ethics in
modern industries has been attracted attention from
academic scholars and business world in recent years [1].
Unethical behaviors of employees in organizations have
been proved to have negative impact on the economic
landscape. Unethical behavior in workplace occurs in
variety of organizations and it could take many forms, for
example, employees break the rules in organizations,
workplace sabotage, workplace theft and cheat, etc.
Unethical behavior in the workplace is defined as
behavior in organizations violates generally accepted
moral norms of behavior [2], and it does great harm to
organizations’ ethic climate, erode organizational
performance and increase organizational cost, even wreck
economic systems [3]. However, workplace unethical
behaviors widely exist in all kinds of organizations. There
have been empirical studies found that unethical
behaviors impair long-run performance and sustainable
development of organizations, as well as increase the risk
of organizational corruption [4].
Some researchers argue that unethical organizational
behaviors in the workplace are partly due to
organizational injustice [5]. The serious the employees
perceive unfairness in organizations, the more they tend to
react unethically. However, little is known about whether
the relationship of organizational injustice and unethical
behavior in workplace is moderated by relational status of
employees. In China, guanxi plays an important role in
various social activities. The meaning of guanxi is beyond
personal social ties in the West, it is rooted in differential
pattern of traditional Chinese culture, and involves
personal favors to achieve some particular benefit.
Employees in various relational status react differently in
behavior and psychology to organization environment [6].
However, how different employees react unethically to
organizational injustice is remain unrevealed.
This paper is to explore the impact of injustice
perception of employees on unethical behavior.
Furthermore, this paper is trying to reveal the moderator
role of employees’ relational status in Chinese
differentiate pattern of culture. The left part of this paper
contains four sections. The first section is to describe the
theoretical relationship among organizational injustice,
relational status and unethical behavioral intention. The
second section is to describe method and result of
empirical study. The third section discusses the results
and describes the flow of this study.
II. LITERATURE REVIEW
Organizational injustice. Research on organizational
justice has focused on three main domains: distributive,
procedural, and interactional justice. Distributive justice
means employees’ response to the outcomes they receive.
Procedural justice means employees’ reaction to the
process of fairness. Interactive justice focuses on
employees’ reaction to the treatment from people
important [7]. Some researchers argue that procedure is
more important because it determine a particular outcome
[8]
. However, outcome of payment contributes
significantly to individuals’ perceptions of organizational
fairness, and thus explains their behaviors effectively [9].
Despite the significant difference of behavioral
responses of individuals caused by justice and injustice,
research on responses to distributive injustice is
insufficient. Individuals’ reactions may differ depending
on the extent to the degree of unfairness they perceived.
According to equity theory, the serious they evaluate their
distributive outcomes unfair, the more intention of them
behaving reactively to eliminate injustice. Studies on
distributive injustice in organizations have shown that
employees who have perceived greater unfairness about
the outcomes they received tended to engage in more
deviance behaviors in organizations. One possible cause
is that individuals who feel unfairly treated may reduce
their positive prosocial behaviors so as to avoid possible
exploitation [10].
Unethical behavior in workplace. Employees often
cross ethical boundaries in workplace to cheat, sabotage,
steal, etc. Scholars interested in business ethics have
contesting opinions on the reason of unethical behavior.
Some of them attribute unethical work behavior as result
of character flaws, for example, bad apples approach.
Others who insist bad barrel approach consider that
dishonesty behavior is the result of situation, for instance,
institution, circumstance, and situations (for a review, see
[1]). In recent, scholars have paid more attention to
situational variations for their overwhelming impact on
(un)ethical decision making. Rest (1986) considered that
(un)ethical decision making process which includes four
steps (awareness, judgment, intention, and behavior) is
influenced by situational factors [11]. Plenty of empirical
studies have shown that unethical behavior is explained
by situational factors rather than by character traits [3] [12].
There
exists
positive
correlation
between
organizational injustice and unethical work behavior.
Based on social exchange principles, it can be easily
concluded that individuals tend to response
correspondingly toward the source of fair or unfair
treatment. The individuals who believe they are treated
fairly by their organizations feel obligated to reciprocate
through contribution, cooperation, and proactive behavior
in organizations. On the other hand, those who believe
they are treated unfairly may reciprocate through kinds of
negative actions, such as unethical behaviors [2]. A
number of studies imply that employees’ unethical work
behavior is influenced by job context, incentive institution,
and organizational culture [13]. Particularly, employees
who perceive injustice in organizations have more
intention in engaging in unethical behavior in workplace
[2]
. Therefore,
Hypothesis 1: Perception of organizational
injustice is positively related to employees’
unethical behavior in workplace.
However, the relation between organizational injustice
and unethical behavior is moderated by some variables.
Just as Aquino, Tripp, and Bies (2006) noted, employees
with lower status engaged in more revenge behaviors
when the climate for justice was low [14]. In china, guanxi
plays an important role in all hierarchies of Chinese
societies.
Guanxi. Chinese people have the tendency of treating
people differently according to distant and close
relationship between themselves and target persons.
Guanxi includes three main types: personal ties,
instrumental ties, and mixed ties. Personal ties mean
connections of families, classmates or fellow-villagers.
Instrumental ties mean connections of colleagues. Mixed
ties mean personal and instrumental ties together
developed through social interactions. Persons who have
close connections with powerful key managers will
possibly have more resources and possess more
opportunities to achieve success. Therefore, they should
more sensitive to distributive injustice. While those who
have distant connections with powerful key managers will
get used to estrangement and negligence from the leaders.
Thus, they should not sensitive to distributive injustice.
Hence:
Hypothesis 2: Guanxi status to the managers
positively related to unethical behavior.
In China, for those who have close guanxi with
organization leaders, they rely more on social
connections and private interactions to rationally deal
with injustice in serious unjust environment. However,
for those who have distant guanxi with organization
leaders, they rely more on themselves to independently
response to unfair distributive outcomes. And they are
more likely to react unethically and irrationally in
serious unjust situation. Hence:
Hypothesis 3: Guanxi status to the managers
negatively moderates the relationship between
distributive injustice and unethical behavior.
III. METHOD
Research hypotheses of this study will be examined
using empirical method which includes quasi-experiment
and questionnaire investigation.
A Participants
Participants were 236 senior college students and
MBA students of a comprehensive university in the
central of China. Participants voluntarily took part in our
experiment without any payment. 193 participants
returned qualified questionnaire with a response rate of
81.7%. Average age of these 193 participants was 24.4.
125 of them were males, and 68 were females.
B Procedures
Firstly, 236 participants were divided into two groups
randomly. One group members were told they could
imagine themselves as the protagonist who was a
henchman of the organization leader, and he was close to
leaders both in workplace and privately. The other group
members were told they imagined themselves as the
protagonist who was a sidelined person to the
organization leader. He only had working contacts to the
leader, and hardly shared any private time with leaders.
Then, secondly both groups were presented a series of
scenarios. The protagonist in four scenarios was about an
employee who was treated unfairly on his payment in
workplace (distributive injustice), and from scenario first
to fourth the degree of unfairness increased in turn. At the
end of each scenario, each participant was asked to
complete a questionnaire on intention of unethical
behavior.
C Measures
Therefore, Hypothesis 1 was supported while Hypothesis
2 was rejected.
The focal employees were asked to provide
information on their intention to act unethically to the
injustice in workplace. The questionnaire of intention of
unethical behavior was a 5-point Likert Scale that
consisted of five items developed by the authors. From 1
to 5 meant very disagree to very agree. Demographic
information were manipulated as control variables in
analysis.
D Analysis Methods
After collecting data, we used SPSS 16.0 for
analyzing. Descriptive statistics, ANOVA and linear
regression
method were employed for testing the
Hypotheses.
IV. RESULTS
In this section, analysis results and findings to the data
were presented. This study was a 4*2 quasi experiment
study. Before formal analysis, cronbach’s Alpha
Consistency Reliability is used to examine items’
consistent of intention of unethical behavior. Cronbach
coefficient alpha coefficient, which implies internal
consistency reliability among a group of items of the scale
of unethical behavioral intention, was 0.94 in this study.
The result meant acceptable internal consistency of the
instrument used.
B Moderating role of guanxi status
In order to further analyze the moderating role of
guanxi status, we conducted linear regression of unethical
behavioral intention. Before regression analysis, we
created three dummy variables to illustrate level of
perceived injustice, and compared this regression model
to the model that take perceived injustice as continuous
variable. However, the results made no difference. Then
we created an interactive variables (injustice*guanxi)
after centralization.
The regression result showed that standard coefficient
of interactive variable was significant after controlled
demographic variables (Beta = -.40, t= -2.81, p= .006),
which implied guanxi status of individuals to their leaders
played a negative moderating role in the relationship
between organizational injustice and unethical behavioral
intention. The regression model explained 13% (p= .00)
variation of overall variation of unethical behavioral
intention of individuals. Figure 1 shows the interacting
effect of guanxi status.
A Effects of injustice and guanxi status
ANOVA was employed to examine the main and
interactive effect of organizational injustice and guanxi
status. The result of ANOVA analysis was shown in
Table 1.
TABLE I
Main and interact effects of injustice and guanxi status on unethical
behavior
Group
Unethical behavior
F of guanxi
Mean (n)
SD
Close
No unfair
10.53
6.06
guanxi
Low unfair
11.15
7.68
Middle unfair
11.50
4.89
F = 2.26 (df =1)
High unfair
10.90
6.29
p = 0.134
Distant
No unfair
6.56
4.37
guanxi
Low unfair
7.02
4.66
Middle unfair
10.12
5.64
High unfair
13.44
6.89
F of
F of interaction
injustice
F = 5.74(df = 3), p = 0.001
F = 2.62(df = 3),
p = 0.052
The result of ANOVA implied that the main effect of
organizational injustice on unethical behavioral intention
was significant, while the main effect of guanxi status of
individual was non-significant. However, the interactive
effect of injustice and guanxi status was significant in
explaining the variance of unethical behavioral intention.
Fig. 1. Moderating effect of guanxi status
From Figure 1, it can be seen that those who have
distant guanxi with organizational leaders are more
sensitive to organizational injustice. They vary their
unethical behavioral intention according to level of
injustice perceived, the serious they perceive injustice, the
more likely they engage in unethical behavior in
workplace. However, those keep close guanxi with the
leaders react slowly to injustice, they almost keep
constant as perceived workplace unfair varied. Therefore,
Hypothesis 3 was fully supported by this data.
V. DISCUSSION
In this section, the research findings and conclusion
are represented.
The purposes of this study were to explored how
organizational distributive injustice perceived by
individuals and their guanxi status to the leaders predict
their unethical behavioral intention. Results show that the
serious individuals perceive unfair about distributive
outcomes, the more possibly they engage in unethical
behavior. This result is consistent with findings of Jones
(2009) [2] and Gino, Ayal and Ariely (2009) [3]. Our
findings of positive relation of injustice and unethical
behavior give further evidences to the opinion that justice
are widely accepted and most desired social context [15].
Pursuit of justice is a basic social motivation that drives
an individual reacts unethically to regain sense of justice.
There exists no difference on the overall unethical
behavioral intentions between individuals of close and
distant guanxi status. Moreover, we extend previous work
by examining the moderating role guanxi plays in the
relation between injustice and unethical behavior.
According to the theories of social psychology,
individuals react differently in order to in accord with
their specified social status. Especially for the Chinese,
the first thing they should take into consideration before
response to environment is evaluating their social status in
the group (Fei, 1949). Echoing this opinion, this study
highlights the value of guanxi status of an individual, and
verifies its moderating effect. Those persons possess close
relation with key persons are not so sensitive to
distributive injustice and their unethical behavioral
intention almost keep constant. But those who are
alienated from the key person are much more sensitive to
injustice, their unethical behavioral intention increases
more steeply as unfairness increases.
Despite some limitation, this study contributes on
understanding the relationship between injustice and
unethical behavior in Chinese culture context. We believe
some conclusions of this study are useful to improve
effectiveness of regulating and reducing unethical
behaviors of employees in various organizations.
ACKNOWLEDGMENT
This is a periodical research result supported by
Humanities and Social Science Project funded by Chinese
Ministry of Education (No. 11YJCZH153).
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