Do Auditing and Reporting Standards Affect Firms’ Ethical Behaviours? The Moderating Role of National Culture

Yasemin Zengin Karaibrahimoglu, Burcu Guneri Cangarli

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Abstract

This paper aims to examine the impact of national cultural values on the relation between auditing and reporting standards and ethical behaviours of firms. Based on a regression analysis using data regarding 54 countries between the years 2007 and 2012, we found that the impact of the perceived strength of auditing and reporting standards on
the perceived ethical behaviours of firms is accentuated when a society is characterized by low power distance and ingroup collectivism, and high institutional collectivism, future
orientation and uncertainty avoidance. Empirically, the study addresses a gap in the literature by highlighting the influence of national culture on the effectiveness of legal
settings and regulations on ethical behaviours.
Original languageEnglish
Pages (from-to)1-21
JournalJournal of Business Ethics
Volume139
Issue number1
DOIs
Publication statusPublished - Nov-2016

Keywords

  • Ethical behaviour
  • Strength of auditing and reporting standards
  • Culture
  • GLOBE

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