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An empirical
Determinants and consequences study of
of ethical behaviour: an empirical salespeople
study of salespeople
473
Sergio Román and José Luis Munuera
Marketing Department, University of Murcia, Murcia, Spain Received July 2003
Revised April 2004
Accepted August 2004
Abstract
Purpose – The main purpose of this research is to gain a clearer understanding of several key
determinants and consequences of the ethical behaviour of salespeople.
Design/methodology/approach – Questionnaires were administered during regularly scheduled
meetings to a total of 280 financial services salespeople. The salespeople questioned were mainly
specializing in selling high-involvement financial products (e.g. mortgages, life insurance) to final
consumers.
Findings – Results suggest that method of compensation and control system (CS) are important
determinants of ethical behaviour. Age (AGE) also proves to be a significant antecedent of ethical
behaviour. However, education (EDU) is not significantly related to ethical behaviour. Additionally, a
salesperson’s ethical behaviour leads to lower levels of role conflict-intersender and higher levels of job
satisfaction, but not higher performance.
Research limitations/implications – To improve generalization of the findings, future research
should broaden the sample by including a variety of industries. Likewise, the use of longitudinal data
could provide new insights into the antecedents and consequences of ethical behaviour of salespeople
and in particular the relationship with performance. Continuing research is needed to further analyse
the relationship between ethical behaviour and other relevant behaviours that may take place during
the interaction with the customer (e.g. organisational citizenship behaviours and customer orientation).
Practical implications – This research is, to our knowledge, the first study that simultaneously
identifies and analyses several key antecedents and consequences of the ethical behaviour of
salespeople.
Originality/value – This study adds to the literature by reducing the existing gap and showing
companies insights into how to foster ethical sales behaviour and the positive consequences that this
behaviour has on their salespeople.
Keywords Business ethics, Sales force, Financial services
Paper type Research paper

Introduction
Sales professionals have been frequent targets of ethical criticism (Abratt and Penman,
2002). For example, the results of a Sales & Marketing Management survey of 200 sales
managers revealed that 49 per cent of managers say their salespeople have lied on a
sales call, 34 per cent say their salespeople have made unrealistic promises on a sales
call and 22 per cent say their salespeople have sold products their customers did not
need (Marchetti, 1997).
There are several reasons for focusing specific attention on salespeople’s ethical European Journal of Marketing
Vol. 39 No. 5/6, 2005
behaviour. Salespeople are exposed to greater ethical pressures than individuals in many pp. 473-495
other jobs. They work in relatively unsupervised settings; they are primarily responsible q Emerald Group Publishing Limited
0309-0566
for generating the firm’s revenues, which at times can be very stressful and they are often DOI 10.1108/03090560510590674
EJM evaluated on the basis of short-term objectives (Dubinsky et al., 1986; Bellizzi and Hite,
39,5/6 1989; Wotruba, 1990). In addition, research suggests that a salesperson’s ethical behaviour
can play a critical role in the formation and maintenance of long-term buyer-seller
relationships (Gundlach and Murphy, 1993; Román and Ruiz, 2005). In contrast, unethical
behaviour can even generate liability problems for salespeople’s organizations through
both intentional and inadvertent statements (Boedecker et al., 1991).
474 Despite the importance of understanding salespeople’s ethical behaviour, only a few
studies have empirically addressed the determinants and consequences of such
behaviour (Loe et al., 2000; McClaren, 2000) and none of them, to our knowledge, has
simultaneously analysed its determinants and consequences. Therefore, the main
purpose of this research is to gain a clearer understanding of several key determinants
and consequences of the ethical behaviour of salespeople. By doing so, we will
contribute to the marketing literature reducing the existing gap and we will show
companies insights into how to foster ethical sales behaviour and the positive
consequences that this behaviour has on their salespeople. The following
sections develop the hypotheses, test them empirically and discuss implications of
the findings.

Research hypotheses
Ethical sales behaviour
The salesperson may behave unethically, when interacting with different stakeholders
such as customers, competitors and employers. In the hierarchy of stakeholder
importance, it appears that salespeople regard ethical transgressions against
customers as being less ethical than any controversial actions against competitors
or their employer (Chonko and Burnett, 1983; Chonko and Hunt, 1985). Accordingly,
the focus of this research is on salespeople’s ethical behaviour as related to interactions
with their customers.
Ethical selling behaviour is a highly elusive construct and is often situation specific
(Lagace et al., 1991). Nevertheless, it can be argued that ethics requires an individual to
behave according to the rules of a moral philosophy with an emphasis on the
determination of right and wrong (Gundlach and Murphy, 1993). More specifically,
ethical sales behaviour is related to widely “recognized” societal norms such as fair
play, honesty and full disclosure (Robertson and Anderson, 1993; Futrell, 2002).
Consequently, in the context of this study, ethical sales behaviour is defined as fair and
honest actions that enable the salesperson to foster long-term relationships with
customers based on customer satisfaction and trust. Examples of such activities
include: selling products that meet customers’ needs, providing true information about
the product (e.g. when comparing with the competitors’ products, or in terms of its
benefits or availability) and implementing low-pressure selling techniques (Chonko
and Burnett, 1983; Dubinsky et al., 1991; Lagace et al., 1991; Reidenbach et al., 1991;
Tansey et al., 1994; Verbeke et al., 1996; Singhapakdi et al., 1999).
The conceptual model we propose is shown in Figure 1, namely that some
organizational factors (reward system (RE) and salesforce control system (CS)) and
some personal factors (age (AGE) and education (EDU)) affect the salesperson’s ethical
behaviour. Further that this behaviour, in turn, influences the salesperson’s role
conflict-intersender, performance and satisfaction. This research does not intend to
examine all potential antecedents and consequences of ethical behaviour, rather it
 An empirical
study of
salespeople

475

Figure 1.
Conceptual model

represents a further step in the process of understanding how several key personal and
organisational variables are related to ethical behaviour in the personal selling context.
The logic for the choice of such variables and their hypothesised relationship with
ethical sales behaviour is explained below.

Determinants of ethical sales behaviour

Reward and control system. The RE and CS have been found to be key managerial
factors affecting salespersons’ actions. For instance, findings from Cravens et al. (1993)
and Oliver and Anderson (1994) showed significant effects on customer-oriented
selling, a behaviour that is closely related to ethical behaviour (Howe et al., 1994). We
believe that the influence of the RE and CS on ethical behaviour deserves further
attention. On the one hand, previous research analysing the relationship between the
compensation system and ethics has led to mixed findings. Kurland (1996) did not find
a significant relationship, whereas findings from Honeycutt et al. (2001) indicate that
the firm’s reward structure significantly influenced the ethical behaviour of
salespeople. On the other hand, past research has analysed the effect of a CS either
on a salesperson’s ethical decision-making (Verbeke et al., 1996), or on a salesperson’s
ethical judgments (Robertson and Anderson, 1993), but not on behaviour as reported
by salespeople. This is the reason why Ross and Robertson (2003) recently called for
continuing research to explore the relationship between the CS and ethical behaviour.
The RE comprises a set of processes through which behaviours are directed and
motivated to achieve individual and organizational goals (Chonko et al., 1996).
Compensation plans emphasizing salary are recommended, when firms want their
salespeople to adopt a long-term orientation and invest time servicing accounts to
realize future sales. In contrast, plans emphasizing incentives are advocated, when
firms want their salespeople to get immediate sales (John and Weitz, 1989; Howe et al.,
1994).
Results from Victor and Cullen (1988) indicated that commissioned sales
organizations develop instrumental ethical climates characterised by statements
such as “in this company, people are mostly out for themselves” and “people are
EJM expected to do anything to further the company’s interests, regardless of the
39,5/6 consequences”. In this vein, commission pay systems create a conflict of interest for the
salesperson. On the one hand, it rewards salespeople to act in the firm’s interest, as well
as their own interest, but fails to similarly directly reward salespeople to act in the
customer’s interest (Kurland, 1995; 1999). This is the case, when the salesperson may
find in his/her best interest to act unethically (e.g. by withholding information from the
476 client) in order to make the sale and earn the commission (Kurland, 1999). In other
words, commission-based compensation methods might motivate the salesperson to
act in an unethical manner that will result in maximun sales. Such a motivation is
likely to be absent in salary-based methods (Honeycutt et al., 2001). A salary-based
compensation system is likely to encourage the salesperson to adopt a long-term
perspective with his/her customers, since under this system the company assumes
most of the risk of lost sales and the salesperson little, so he/she feels less pressure to
get immediate sales, thereby reducing the changes of unethical practices being used
(Robertson and Anderson, 1993).
Empirical evidence from Kalra et al. (2003) indicated that, when the salesperson
compensation derives a larger fraction of compensation based on sales commissions,
there was an incentive to behave unethically. Accordingly, we propose the first
hypothesis:
H1. The higher the fixed salary percentage of the salesperson, the more ethical the
salesperson’s behaviour.
Salespeople are thought to behave differently depending on the CS they face (Anderson
and Oliver, 1987). Initially, Anderson and Oliver (1987) defined a salesforce CS as “a set
of procedures the organization has for monitoring, directing, evaluating and
compensating its salespeople”. However, our definition of salesforce CS is more in
line with recent studies that have considered the CS as a global construct, where the
compensation component is not included (Verbeke et al., 1996; Piercy et al., 2001). This
is consistent with John and Weitz’s (1989) argument that a CS predicts, but does not
include, the style of compensation.
A behaviour CS allows for non-sales goals, such as account maintenance and
service. A longer perspective can be assumed because immediate results can be
balanced with long-term sales relationships and outcomes (Oliver and Anderson, 1994).
In contrast, in an outcome CS sales techniques may be compromised as short-run goals
are pursued (Oliver and Anderson, 1994). In a behaviour-based CS managers are
directive with their salespeople (they specify desired behaviour rather than settling for
outputs, however achieved) and are well informed about their activities (behaviours or
inputs). Consequently, the risk of detection and punishment of unethical behaviour is
much higher in such systems (Robertson and Anderson, 1993; Verbeke et al., 1996). In
other words, the existence of opportunities for unethical behaviour decreases in a
behaviour-based CS and hence the salesperson is more likely to suffer any “cost”
associated with behaving unethically.
Results form Hunt and Vasquez-Parraga (1993) indicated that one of the advantages
of behaviour-based CS is “the development and maintenance of an organizational
culture that encourages ethical behaviour and discourages unethical behaviour”.
Further research has shown that a behaviour-based CS significantly influences
salespeople’s ethical judgments (Robertson and Anderson 1993) and salespeople’s
ethical decision-making (Verbeke et al. 1996). Similarly, results from Ramaswami An empirical
(2002) showed that salespeople’s perceptions of output control were positively study of
associated with their opportunistic behaviour.
In summary, since behaviour-based CSs look at how salespeople reach goals, salespeople
managers can outlaw undesirable and/or unethical procedures, which otherwise could
have been used to obtain immediate sales. By the same token, managers can bring
ethical procedures to the attention of their salespeople, therefore we propose that: 477
H2. The more behaviour-based the salesforce CS, the more ethical the
salesperson’s behaviour.

Age and education. Among the personal antecedents, two clear empirical
generalizations from the non-sales ethics literature are that, although the findings
are not unanimous, older and more educated persons generally behave more ethically
than younger and less educated persons (Browning and Zabriskie, 1983; Jones and
Gautschi, 1988; Ruegger and King, 1992; Deshpande, 1997). These demographic
variables are, in a sense, proxies for a cluster of personality or attitudinal
characteristics that tend to be associated with these demographic characteristics (Ross
and Robertson, 2003). Nevertheless, as indicated by McClaren (2000), because of the
specific characteristics of the sales profession mentioned earlier, previous research has
yielded inconclusive evidence regarding the effect of AGE and EDU on a salesperson’s
ethical behaviour. For example, Hoffman et al. (1991) and Honeycutt et al. (2001) did not
find a significant relationship between a salesperson’s AGE and his/her ethical
behaviour. Results from Dubinsky et al. (1992) indicated that AGE had a significant
impact on salespersons’ ethical perception, whereas EDU had no significant effect.
Consequently, we shall further analyse the role of such demographic variables on
ethical behaviour in the personal selling context.
We expect older salespeople to be more ethical than younger salespeople for several
reasons. First, as AGE increases, subjects have displayed more conservative and strict
ethical tendencies and hold less compromising interpretations of what is to be judged
ethical (Sikula and Costa, 1994). Second, ethical decision-making and intended ethical
behaviour, in general, increases as individuals move from lower levels to higher levels
of moral reasoning (Wotruba, 1990) and moral reasoning is directly linked to AGE
(Rest, 1986). Third, older people have been exposed longer to ethical dilemmas in
non-business contexts (Izzo, 2000), therefore they are more willing to accept and
conform to ethical standards and behave accordingly (Serwinek, 1992). All the above
leads us to propose the following:
H3. The older the salesperson, the more ethical the salesperson’s behaviour.
Despite the inconclusive findings mentioned above, we expect EDU to have a positive
influence on a salesperson’s ethical behaviour. First, it can be argued that the
educational process is designed to foster critical thinking and the ability to view
situations from multiple perspectives (Levy and Sharma, 1994). In this sense, previous
research has found that EDU is positively related to moral judgement (Rest and
Thoma, 1985; Rest, 1986). Similarly, the effect of EDU on ethical behaviour can be
supported by Kohlberg’s (1969) typology. EDU is believed to result in greater
sensitivity to different points of view and to be linked to a person’s stage of cognitive
EJM moral development (Singhapakdi et al., 1999). A second possible link is the normative
39,5/6 view that the core of EDU itself is virtue or right conduct (Hogness, 1986; Howard,
1989). Building upon the Socratic dictum “knowledge is virtue”, this classical view of
EDU would suggest that the more educated would be the more virtues. Accordingly,
we propose that:
H4. The more educated the salesperson, the more ethical the salesperson’s
478 behaviour.

Consequences of ethical sales behaviour

Role conflict-intersender. Following Rizzo et al. (1970), role conflict can be defined by the
dimensions of congruency-incongruency or compatibility-incompatibility in the
requirements of the salesperson role, where congruency or compatibility is judged
relative to a set of standards that affect role performance. Role conflict can be
conceptualized in terms of the following five conflict types or dimensions (Rizzo et al.,
1970; Michaels et al., 1987; p. 31): intersender, intrasender, person-role, interrole and
role overload.
We shall focus on the relationship between ethical behaviour and role
conflict-intersender. This type of role conflict occurs, when two or more role
partners have simultaneous expectations, such that compliance with the expectations
of one role partner makes it difficult or even impossible to fulfil the expectations of the
other role partner(s) (Michaels et al., 1987). For example, salespeople may perceive role
conflict-intersender, when simultaneously trying to meet company expectations and
customer demands. A customer may demand better credit terms or quicker delivery
schedules, which may be unacceptable to the management. Role conflict-intersender is
likely to be the most pervasive and intensely felt conflict experienced by salespeople
(Walker et al., 1975).
Past research has produced mixed findings, when analysing the effect of ethical
behaviour on role conflict. First, Chonko and Burnett (1983) provided empirical
evidence for ethical sales behaviour reducing a salesperson’s role conflict. However,
Dubinsky and Ingram (1984) did not find a significant relationship between these two
variables. Recently, Turner and Valentine (2001), in a sample of customer service and
sales personnel, found that cynicism (that represents a distrusting moral dimension)
was positively related to role conflict. These studies considered role conflict as a global
construct without explicating its dimensions. Based on research conducted by Singh
(2000), we believe that the use of a disaggregated conceptualization of role conflict is
likely to yield clearer results.
Role conflict-intersender involves conflicting expectations from two or more role
partners (Singh, 2000). Generally, the major sources of this type of role conflict are the
company (employer) and the customers (Walker et al., 1975). The salesperson must try
to satisfy the expectations of his/her company and his/her customers. On the one hand,
recognizing the negative consequences of unethical sales behaviour mentioned above
(e.g. decrease in customer satisfaction and trust, possible litigation), a company will
expect its salespeople to behave ethically. On the other hand, customers try to satisfy
their own objectives and needs in a sales transaction and are often unaware of the
policies and constraints under which a salesperson is operating (Walker et al., 1975).
Since, among other things, ethical selling behaviour implies taking into account
customers’ needs, when selling a product (e.g. by refraining from selling products that An empirical
customers do not need) (Ingram et al., 2001), we propose that a salesperson’s ethical study of
behaviour will reduce role conflict-intersender, at least by the percentage that is
attributable to the conflicting expectations of the company and the customers. In a salespeople
similar fashion, following Kelman’s (1958) theory of identification, in order to maintain
a satisfying ego-identity, which is also known as the self-concept or self-image, the
salesperson must maintain positive relationships with others, such as their customers, 479
who support that positive self-image (Kelman, 1961). Interactions with customers who
do not support this positive self-image are likely to lead to feelings of embarrassment
and cognitive discomfort (O’Shaughnessy, 1971). When salespeople behave unethically
(e.g. implementing manipulative sales tactics or high-pressure selling techniques),
there may be a fear of personal rejection by the buyer, because the use of such actions is
not supportive of positive relationships (Boyle and Dwyer, 1995). This fear of rejection,
in turn, does not support a positive self-image and is likely to lead to feelings of stress
and in particular, to increase a salesperson’s role conflict (McFarland, 2003). Stated
formally:
H5. The more ethical the salesperson’s behaviour, the lower the salesperson’s role
conflict-intersender.
Performance. Performance is comprised of behaviours (the activities salespeople
perform) and outcomes resulting from behaviours; the former has been termed
behavioural performance, whereas the latter is known as outcome performance
(Behrman and Perrault, 1982; Grant and Cravens, 1996). In this study we shall focus on
outcome performance, because it has been shown to be positively related to sales force
effectiveness (Cravens et al., 1993; Grant and Cravens, 1999).
The research to date provides little direction in terms of understanding the effect of
ethical sales behaviour on performance. Literature on relationship building in sales
may help. According to anecdotal literature, successful salespeople focus on customers,
earn the customer’s trust and respect and develop partnership relationships with them
(Manager’s Magazine, 1995; Schiffman, 1998). Likewise, empirical research shows that
a salesperson’s ethical behaviour is positively related to customer trust and
satisfaction, thus enhancing relationship quality and the probability of future rewards
to the salesperson (Lagace et al., 1991; Román and Ruiz, 2005). More importantly,
buyers tend to purchase from salespeople they trust (Ganesan, 1994). Focusing on
customers, building relationships based on satisfaction and trust, and making sales are
generally part of a salesperson’s job. Consequently, it is plausible to expect that more
ethical salespeople are more likely to achieve such goals and subsequently improve
their performance.
As for the empirical evidence, the study carried out by Weeks and Nantel (1992)
showed that salespeople who understood their company’s ethical business policy were
moderately successful in their jobs. Similarly, Honeycutt et al. (1995) found that
high-performance salespeople showed high ethical behaviour and Schwepker and
Ingram (1996) have provided empirical evidence of salespeople’s moral judgments as
being positively related to their job performance. Recently, results from Turner and
Valentine (2001) indicated that altruism and performance were positively correlated
among salespeople. Accordingly we propose that:
EJM H6. The more ethical the salesperson’s behaviour, the greater the salesperson’s
39,5/6 performance.
Job satisfaction. Churchill et al. (1974) defined job satisfaction as: “all characteristics of
the job itself and the work environment which salesmen find rewarding, fulfilling and
satisfying or frustrating and unsatisfying”. In a non-sales context, Vitell and Davis
(1990) found that management information systems professionals were less satisfied
480 with their jobs when, unethical behaviour was common within either their industry or
company. Empirical evidence from the sales literature shows that the job satisfaction
of salespeople can be weakened if they perceive their organization as rewarding the
unethical behaviours of co-workers (Bellizzi and Hite, 1989). Similarly, studies by
Weeks and Nantel (1992) and Schwepker (2001) indicated that the code of ethics and
the ethical climate respectively influenced a salesperson’s job satisfaction. Finally, the
qualitative research of Beatty et al. (1996) noted that salespeople’s ethical behaviour
(e.g. having customers’ best interests in mind and being honest to them) led to higher
levels of job satisfaction.
We expect that a salesperson’s ethical behaviour will have a positive impact on
his/her job satisfaction. On the one hand, it can be argued that because of the negative
consequences of unethical sales behaviour previously mentioned, a company will
expect its salespeople to behave ethically. Thus, a salesperson who behaves ethically
will comply with management expectations and will experience feelings of success,
which in turn, will increase his/her job satisfaction (Brown et al., 1993). On the other
hand, a salesperson is likely to be more satisfied with his/her work, most of which is
carried out interacting with customers (Ingram et al., 2001), if he/she behaves ethically,
such as not lying to customers or not applying deceptive and manipulative techniques.
Finally, following Kelman’s (1958) theory of identification explained below, the
practice of ethical sales behaviours supports a positive self-image and, consequently, is
likely lead to feelings of satisfaction. This theorizing is summarized in the following
hypothesis:
H7. The more ethical the salesperson’s behaviour, the greater the salesperson’s
job satisfaction.
Role conflict-intersender and satisfaction. In addition to examining the direct effects of
ethical behaviour on salesperson’s role conflict-intersender, performance and
satisfaction, this study also proposes that ethical behaviour has an indirect and
positive effect on satisfaction through role conflict-intersender.
Role conflict has been negatively related to job satisfaction (Behrman and Perrault,
1984; Brown and Peterson, 1994; Mackenzie et al., 1998). Yet, results from Johnston et al.
(1990) revealed that role conflict had no significant effect on job satisfaction.
Consequently, prior research using a global conceptualization of role conflict has
produced mixed findings. Once again, we believe that the use of a disaggregated
conceptualization of role conflict is likely to yield clearer results (Singh, 2000).
Accordingly, we expect that role conflict-intersender, which is the most pervasive and
intensely felt conflict experienced by salespeople, is likely to reduce a salesperson’s job
satisfaction.
Role conflict-intersender occurs, when the salesperson tries to satisfy the often
inconsistent demands of two or more of his/her role partners. For example, a customer
wants lenient credit terms, but the credit manager wants to deal in short-term credit
with stringent terms. The salesperson may conclude that no matter what he/she does, An empirical
someone will be upset with him. This kind of conflict can produce great anxiety and study of
emotional turmoil for the salesperson, leading to disillusionment with the job (Churchill
et al., 1976). Based on this reasoning, we formulate the last hypothesis of our model: salespeople
H8. The lower the salesperson’s role conflict-intersender, the greater the
salesperson’s job satisfaction.
481

Method
Data collection and sample
Based on the research of Dubinsky et al. (1991, 1992), salespeople from only one
industry were surveyed to hold constant the type of product sold. Prior research has
found that the job-related responses of salespeople vary across sales settings (Churchill
et al., 1985). Accordingly, the cooperation of three financial service institutions in Spain
of approximately the same size was obtained. Financial services are highly abstract
services characterized by credence attributes and consequently difficult for consumers
to fully understand. Hence, the consumer must rely on the agent for correct information
and proper guidance (Howe et al., 1994). Therefore, financial services salespeople could,
if they chose to act unethically, take advantage of the consumer’s naivety and improve
their own position (Wray et al., 1994).
Following Kelley (1992) and Boorom et al. (1998), questionnaires were administered
during regularly scheduled meetings to a total of 280 financial services salespeople. All
of them completed the questionnaires. Respondents were assured that their responses
would be kept confidential and the questionnaires were immediately given to the
researchers. In exchange for salespeople completing the questionnaires, we provided a
sales training seminar following the data collection.
The salespeople questioned were mainly specializing in selling high-involvement
financial products (e.g. mortgages, life insurance) to final consumers. Each salesperson
managed a portfolio of clients and was responsible for ongoing customer contact after
the sale was closed. As shown in Table I, 83 per cent of them were male, 60 per cent
were between 25 and 39 years old, 48 per cent had a college degree and 56 per cent had
from 3 to 15 years of selling experience. In this sample, the total annual compensation
percentage of fixed salary varies from a low of 10 per cent to a high of 95 per cent with
a mean of 78 per cent.

Measures
In-depth interviews were first carried out with convenience samples of financial
services salespeople in order to get a better understanding of the research variables.
Additionally, preliminary versions of the questionnaire were administered[1], as
pretest and results were used to improve measures and design an appropriate structure
(see scale items in Appendix, Table AI).
All scales consisted of ten-point multiple-item Likert questions except the RE, AGE
and EDU. The last two were single-item questions as shown in Table I. Following
Cravens et al. (1993), the RE was measured with the previous and current year
percentages of fixed salary in the salesperson’s pay package. Salesforce CS
was measured by a nine-item scale adapted from Oliver and Anderson (1994) and
EJM Percent Total
39,5/6
Gender
Male 83.6
Female 16.4 100
Age
482 , 25 2.5
25-32 22.9
33-39 37.9
40-45 20
45 þ 16.8 100
Experience
,1 3.2
1-3 23.2
3-8 33.9
9-15 22.5
15 þ 17.1 100
Education
School graduation 5.7
Table I. Diploma (High school) 46.1
Profile of respondents Undergraduate Degree I (three year-degree program) 31.1
ðn ¼ 280Þ Undergraduate Degree II (five year-degree program) 17.1 100

Verbeke et al. (1996). Following these authors, the CS was measured at the level of the
individual as the perception of the salesperson about the CS he/she faces[2].
Since ethical sales behaviour is situation specific (Lagace et al., 1991), we first
reviewed financial services literature looking for relevant unethical practices in the
industry that take place during the salesperson-customer interaction (Mitchell et al.,
1992; Dunfee and Gunther, 1999; Cooper and Frank, 2002; Román, 2003). We selected
the scale developed by Román (2003), because it measures ethical sales behaviour from
the customers’ perspective in the Spanish financial services industry. Next, we
pre-tested this scale during in-depth interviews carried out with salespeople. Based on
the results of these interviews a three-item scale adapted from Román (2003) was used
to measure the salesperson’s ethical behaviour (ESB). These items were consistent with
previous unethical sales behaviours identified in the financial services literature and
reflected the most predominant ethical problems faced in the Spanish financial services
industry: “If I am not sure a product is right for a customer, I will still apply pressure to
get him to buy”, “I stretch the truth about the competition in order to make my product
more attractive to the customer” and “I lie about the availability of the product in order
to make the sale”[3]. All items were reverse-scored. Therefore, a high score indicates a
greater degree of ethical sales behaviour. This procedure of using negatively-expressed
items to measure ethical behaviour is common practice in the ethics literature (Lagace
et al., 1991; Honeycutt et al., 2001).
Role conflict-intersender (RCI) was measured by the original two items that
composed this dimension in Rizzo et al.’s (1970) scale. Performance (P) was measured
by four items from the “outcome” performance dimension in Behrman and Perrault’s
(1982) study. Following Dubinsky et al. (1986), job satisfaction (JS) was assessed by a
three-item version of the Hackman and Oldhman’s (1976) scale.
 A confirmatory factor analysis model for the six multi-item scales was carried out An empirical
using the maximum likelihood procedure in LISREL 8.30 (Jöreskog and Sörbon, 1996). study of
Overall goodness-of-fit estimates of the measurement model suggests a good fit
between theory and data (Table II). salespeople
Reliability of the measures was confirmed with coefficient alpha higher than the
recommended level of 0.7 (Nunnally, 1978). Also, all items loaded on their hypothesized
factors and the estimates were positive and significant (the lowest t is 9.01) which 483
provided evidence of convergent validity (Bagozzi and Yi, 1988). Discriminant validity
among the dimensions of each of the six concepts considered was assessed by
restricting factor intercorrelations (F) pairwise to unity and subsequently computing a
chi-square difference test (CDT), following Anderson and Gerbing’s (1988) suggestions.
All model comparison statistics were significant, indicating that the null hypotheses of
equal fit should be rejected, which provides evidence of discriminant validity. The
estimated correlation matrix among the constructs is shown in Table III.

Results
The results of the structural model, shown in Table IV, provide support for all of the
hypotheses formulated in the conceptual model except H4 and H6. That is to say, EDU
does not influence ethical behaviour and ethical behaviour does not have a significant
effect on performance. The model’s fit was acceptable when one takes into account the
large sample size ðn ¼ 280Þ and the normed chi-square value ðx 2 =df ¼ 1:70Þ[4]. In
addition, the CFI and the TLI are greater than 0.90 and the RMSEA and RMSR are not
greater than 0.08 (Hair et al., 1998).
Overall, the three significant antecedents accounted for 15 per cent of the variance in
salesperson’s ethical behaviour. Research has already found several antecedents to
ethical behaviour not included in our model such as cognitive moral development,

CS RE P ESB JS RCI

CS1 0.71 (11.63)

CS2 0.66 (10.71)
CS3 0.71 (11.70)
RE1 0.99 (23.58)
RE2 0.93 (20.96)
P1 0.79 (15.11)
P2 0.85 (16.89)
P3 0.80 (15.46)
P4 0.79 (15.20)
ESB1 0.57 (9.68)
ESB2 0.88 (15.13)
ESB3 0.78 (13.31)
JS1 0.64 (11.87)
JS2 0.85 (16.98)
JS3 0.99 (21.28)
RCI1 0.90 (10.16) Table II.
RCI2 0.72 (9.01) Estimated coefficients
x 2 ð104Þ ¼ 159:7; p , 0:01; x 2 =df ¼ 1:53; GFI ¼ 0:93; CFI ¼ 0:97; RMSEA ¼ (standardized), t-values
0:04; RMSR ¼ 0:04; TLIðNNFIÞ ¼ 0:97 and fit statistics in the
Note: t value in parenthesis measurement
EJM Coefficient alphas 1 2 3 4 5 6 7 8
39,5/6
1. CS 0.74 1
2. RE 0.96 0.02 1
3. P 0.88 0.03 2 0.04 1
4. ESB 0.78 0.30*** 0.14** 0.07 1
484 5. AGE – 20.19*** 2 0.04 0.12** 0.10* 1
6. EDU – 20.02 0.04 20.14** 20.02 2 0.22*** 1
Table III. 7. JS 0.86 0.43*** 2 0.04 0.11* 0.12* 0.10* 2 0.10* 1
Correlations and 8. RCI 0.78 20.31*** 0.05 20.07 20.10* 2 0.10* 0.05 2 0.27*** 1
reliability estimates Notes: *p , 0:1; **p , 0:05; ***p , 0:01

ethical intention, perceived competitive intensity, peer pressure and code of ethics
(Wotruba, 1990; McClaren, 2000). Ethical behaviour explains 2 per cent of the variance
in a salesperson’s role conflict-intersender, which can be expected given the fact that
role conflict-intersender is caused by a number of different people including peers,
other executives in the company and the salesperson’s family (Walker et al., 1975).
Finally, ethical behaviour and role conflict-intersender explained 9 per cent of the
variance in job satisfaction, which again might be expected due to the number of
determinants of job satisfaction not considered in this conceptual model (Brown and
Peterson, 1993).

A rival model
It is generally agreed that researchers should compare rival models and not just test
the performance of a proposed model (Anderson and Gerbing, 1988; Bagozzi and Yi,
1988). Our model posits that the RE, CS, AGE and EDU influence their outcomes only
through the key mediating variable of ethical behaviour. Because our parsimonious
model permits no direct path from any of the four variables to any outcome, it implies a
central nomological status for ethical behaviour. Based on previous research, we
estimated a rival model (less constrained model) that adds five new paths not
considered in the conceptual model. Following research from Cravens et al. (1993) and
Grant and Cravens (1996), the RE and the CS were hypothesized to influence
performance. In addition, consistent with Goolsby (1992) and Michaels and Dixon
(1994), EDU was also viewed as direct antecedents of role conflict-intersender. Based
on empirical evidence from Churchill et al. (1985) and Babakus et al. (1999), a direct
path from role conflict to performance was allowed to be estimated. Similarly,
following Michaels et al. (1987) and Babakus et al. (1999), performance was
hypothesized to influence job satisfaction.
The rival model had a x 2 value of 231.51 with 135 degrees of freedom. The
remaining fit statistics indicated an adequate fit of the data
( x 2 /df¼ 1.71 CFI ¼ 0.95; GFI ¼ 0.91; RMSEA ¼ 0.05; RMSR ¼ 0.08;
TLI(NNFI) ¼ 0.93). However, the decrease of the chi-square between our proposed
model and the rival model was not significant ð7x 2 ð5Þ ¼ 6:78; p . 0:1Þ. On the basis
of these findings, we believe that the exercise of fitting a rival model has provided
additional support for our conceptual model.
Path Hypothesis Standardized estimate Hypothesis supported R2 Fit statistics

RE(þ) ! ESB H1 0.15 (2.31)** Yes

CS(þ ) ! ESB H2 0.35 (4.69)*** Yes
AGE(þ ) ! ESB H3 0.19 (2.84)*** Yes
EDU(þ) ! ESB H4 0.002 (0.10) No 0.15 x 2 ð140Þ ¼ 238:29 p , 0:01
ESB(2 ) ! RCI H5 20.12 (21.86)* Yes 0.09 x 2 =df ¼ 1:70
ESB(þ ) ! P H6 0.08 (1.11) No 0.005 GFI ¼ 0:91 CFI ¼ 0:95
ESB(þ ) ! JS H7 0.11 (1.70)* Yes RMSEA ¼ 0:05 RMSR ¼ 0:08
RCI(2) ! JS H8 20.26 (23.01)*** Yes 0.02 TLIðNNFIÞ ¼ 0:94
Notes: t value in parenthesis. *p , 0:1; **p , 0:05; ***p , 0:01

Results of hypothesized
salespeople
An empirical

model
485

Table IV.
study of
EJM Discussion
39,5/6 This research is, to our knowledge, the first study that simultaneously identifies and
analyses several key antecedents and consequences of the ethical behaviour of
salespeople. We believe this research makes significant contributions to the literature.
Firstly, Chonko et al. (1996) highlighted the importance of studying the consequences of
sales management activities in salespeople’s ethical decision-making. We have
486 responded to their challenge by analysing how the RE (H1) and CS (H2) affect
salespeople’s ethical behaviour. Our results provide evidence that both systems are clear
determinants of a salesperson’s ethical behaviour. The first finding contributes to the
literature by providing further empirical evidence for the significant results obtained by
Honeycutt et al. (2001) and also overcoming its main limitation: ethical behaviour was
approached by a single-item measure, which may not have captured the nature of the
variable. The second finding represents an initial step in providing empirical support for
the positive effect of a behaviour-based CS on a salesperson’s ethical behaviour.
Secondly, our results indicate that as The AGE of salespeople increases, they appear
to become more conservative in their ethical behaviour (H3). It is important to take into
account that though correlated with sales experience, age presents opportunities for
role-taking resolution of ethical dilemmas in non-business contexts, which implies that
an older salesperson has been exposed to either overt or implied ethical standards, thus
being more apt to accept those standards and behave accordingly. On the contrary, it
seems that a higher level of EDU does not have a direct impact on ethical behaviour
(H4). A possible explanation is that EDU was measured as years of EDU, whereas the
type of EDU and more specifically, ethical EDU may be a more important determinant
of ethical behaviour (Izzo, 2000).
Thirdly, previous research analyzing the relationship between ethical behaviour
and role conflict has led to mixed findings (Chonko and Burnett, 1983; Dubinsky and
Ingram, 1984). The use of a disaggregated conceptualization of role conflict has yielded
clearer results, as our findings provide evidence of ethical behaviour reducing a
salesperson’s role conflict-intersender (H5). Likewise, the results support the notion of
ethical behaviour and role conflict-intersender as significant determinants of job
satisfaction (H7 and H8). The first finding (H7) provides further empirical evidence to
Beatty et al.’s (1996) results obtained through a qualitative research method and
represents, to our knowledge, the first quantitative test of a salesperson’s ethical
behaviour enhancing job satisfaction. The second finding (H8) implies that ethical
behaviour has also an indirect effect on job satisfaction through role conflict and
provides additional support for previous theoretical arguments and empirical evidence
favouring the negative effect of role conflict on job satisfaction (Behrman and Perrault,
1984; Brown and Peterson, 1994).
Finally, ethical sales behaviour does not seem to translate into short-term sales
performance (H6), which warrants further discussion and analysis. This result can be
attributed to a number of reasons. First, it is somewhat consistent with previous
empirical research that has not found a significant relationship between ethical
behaviour and performance (Honeycutt et al., 1995). Second, an organization’s RE may
encourage, albeit unintentionally, the unethical conduct of salespeople. Salesperson’s
behaviour (including unethical behaviour) that results in increased sales also increases
agent commissions, which in turn reinforces the behaviour utilized to obtain those
sales (Ferrell and Fraedrich, 1991). Hence this type of RE may tend to focus
salespeople’s efforts on activities with immediate payoffs (Lagace et al., 1991). Past An empirical
studies have indicated that the unethical behaviour of top producing salespeople is study of
more likely to be overlooked by sales managers thus perpetuating such behaviour
among top performance salespeople (Bellizzi and Hite, 1989). Third, ethical salespeople salespeople
are more likely to develop and maintain long-term buyer-salesperson relationships
through the development of trust (Hawes et al., 1989), but not necessarily to increase
short-term sales; which is consistent with Dubinsky et al.’s (1992) comments: “. . .at 487
least in the short run, questionable conduct may engender selling success”. In addition,
ethical behaviour may lead to higher sales only when salespeople are dealing with their
relational customers as opposed to transactional customers. Relational customers
could reward the ethical behaviour of the salesperson by continuing to place orders.

Managerial implications
We believe our findings have strong managerial implications because they suggest
that variables under management control (compensation and CS) are more important in
terms of explaining salespeople’s ethical behaviour as compared to demographic
variables not directly controllable by the company (AGE and EDU). Companies need to
foster a salesperson’s ethical behaviour not only because of the positive consequences
to the salesperson in terms of higher job satisfaction and lower role
conflict-intersender, but also because unethical sales behaviour can cause disputes
with customers, possibly even resulting in litigation.
We encourage corporations to create an environment where the potential for
unethical behaviour is quite low. Accordingly, we suggest that sales managers should
take time to communicate with their salespeople, assisting and guiding them to
accurately view their day-to-day sales activity from an ethical perspective; then not
reward them on a 100 per cent commission based on the sales made and evaluate their
various activities, not just the outcomes achieved (sales volume). We do not imply that
companies should avoid incentive programs, rather they could use a combination of
base salary plus incentive pay in the form of commissions, bonuses or both based not
only on the sales performance, but also on how well long-term objectives such as
customer satisfaction have been achieved. In addition, since older salespeople seem to
behave more ethically than younger ones, training program content should be adjusted
to meet the needs of different age groups. For example, younger salespeople should be
given material that emphasizes the importance of company ethical norms and values.
Finally, these recommended managerial actions can be reinforced by some form of
ethical code or rules to guide salespeople’s ethical behaviour and this code of ethics can
be incorporated into the training program.

Limitations and suggestions for future research

To improve generalization of the findings, future research should broaden the sample
by including a variety of industries. This study has been restricted to Spanish financial
services salespeople and replication studies in other countries and other industries
should prove useful.
On the other hand, the three items used to measure ethical sales behaviour may not
capture all the important aspects of this construct, yet it is generally acknowledged
that “it is impossible to sample the entire domain of ethical behaviour” (Robertson and
Anderson, 1993, p. 638). Since salespeople were asked to evaluate their ethical
EJM behaviour, there may have been a tendency for respondents to deny socially
39,5/6 undesirable traits (e.g. unethical behaviour) given the likelihood of a social desirability
bias (Nederhof, 1985). However, if there were to be a bias it may be shared by all
respondents (Churchill et al., 1985). Moreover, this approach to measuring ethical sales
behaviour has been successfully implemented in previous research (Howe et al., 1994;
Honeycutt et al., 2001) and has an advantage over using projective techniques in that
488 self-reported behaviour is being measured, reducing the possibility of interpretations
changing across different observers (Korner, 1965).
In addition, since the data were collected cross-sectionally using self-report
measures, the potential for common methods variance exists. Following Podsakoff and
Organ (1986), we tested for this bias using Harman’s one-factor approach. A principal
components analysis (unconstrained number of factors with varimax rotation) on the
23-questionnaire items (variables measured with one item were not included) yielded
eight factors with eigenvalues greater than 1.0, accounting for 80 per cent of the total
variance. Given the emergence of several factors and given that the first factor
accounted for only 24 per cent of the total variance, common methods bias does not
appear to be present in the dataset (Podsakoff and Organ, 1986).
Our findings, which validate the important role of the RE and CS in fostering ethical
behaviour, can serve as a useful starting point for this stream of research that may
include other relevant organisational variables such as perceived organizational
support, socialization, training and market orientation. In addition, continuing research
is needed to further analyse the relationship between ethical sales behaviour and other
relevant behaviours that may take place during the interaction with the customer. For
example, previous research has found that ethical sales behaviour was highly
correlated to organisational citizenship behaviour (Turnipseed, 2002) and customer
oriented selling (Román et al., 2002).
We have considered ethical sales behaviour in dealing with customers. One
potential area for future research would be to consider ethical behaviour related to
other stakeholders such as peers, employers or competitors. This would also allow
additional research to examine the relationship between ethical behaviour and
performance in-depth by taking into account other dimensions of sales performance
such as using technical knowledge, providing information, controlling expenses and
making sales presentations (Behrman and Perrault, 1982). Moreover, the use of
longitudinal data could help in understanding this relationship. Ethical intention was
not measured in this study; however, additional research should attempt to explain the
roles of ethical perception and ethical intention in explaining ethical behaviour.

Notes
1. Since the questionnaire was administered in Spanish, the questionnaire was drafted
originally in English and translated into Spanish. The questionnaire was then translated
back into English and checked for consistency with the original to ensure that any idiomatic
or colloquialistic wording was minimized (Douglas and Craig, 1983).
2. Bagozzi and Baumgartner (1994) recommended that three sub-scale composites be developed
as multiple indicators of scales with more than five items. Consequently, maximum
likelihood factor analysis with an oblique rotation was used to guide the development of
three summated sub-scale composites of CS (Lastovicka and Thamodaran, 1991). Then, the
three indicators of the control system (CS1, CS2 and CS3) were used in the confirmatory
factor analysis.
 3. The term availability for banking products/services is referring, for example, to the period of An empirical
time the customer has to wait between ordering a credit card and actually being able to use
it, or the gap between having a bank loan approved and the money being available. study of
4. In samples larger than 200 Hair et al. (1998) suggest using the normed chi-square (x 2/df), salespeople
which indicates a good fit when its value ranges from 1 to 2.

489
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Appendix

Ethical sales behaviour (scale: the statements below describe various ways you may act with your
customers. For each statement please indicate to what extent you behave that way. . .: 1 ¼ “never”
10 ¼ “always”)
ESB1. If I am not sure a product is right for a customer, I will still apply pressure to get him to buy a
ESB2. I stretch the truth about the competition in order to make my product more attractive to the
customer
ESB3. I lie about the availability of the product in order to make the sale
Reward system (scale: percentage of fixed salary in compensation plan. . .)
RE1. Present pay period
RE2. Last pay period
Control systemb
Subjective Input Evaluation (CS1) (scale: how heavily do you think your manager relies on these kinds
of measures in evaluating your performance. . .: 1¼ “doesn’t use at all” to 10 ¼ “uses extensively”)
Attitude
Ability
Effort
Absence of A Bottom-Line Orientation (CS2) (scale: evaluate each statement to reflect to what degree
you agree or disagree with them. . .: 1 ¼ “I strongly disagree” to 10 ¼ “I strongly agree”)
When management rates my performance, they take a lot of things into consideration
Management decides who is good by looking strictly at each salesperson’s behaviour
Management leaves us alone as long as our results are ok
Extent of Supervision (CS3) (scale: evaluate each statement to reflect to what degree you agree or
disagree with them. . .: 1 ¼ “I strongly disagree” to 10 ¼ “I strongly agree”)
My boss makes sure everyone knows what to do and how to do it
Management here stays very well informed of salespeople’s activities
We are subject to very little direction from our company’s management
Role Conflict-Intersender (scale: indicate to what degree do the following things happen in your job. . .:
1 ¼ “never” to 10 ¼ “always”)
RCI1. I receive incompatible requests from two or more people
RCI2. I do things that are apt to be accepted by one person and not accepted by others
Performance (scale: evaluate your performance. . .: 1 ¼ “needs improvement” to 10 ¼ “outstanding”)
P1. Produce a high market share for the company in my territory
P2. Quickly generating sales of new company products
P3. Identifying and selling to major accounts in my territory
P4. Exceeding all sales targets and objectives in my territory during the year
Job satisfaction (scale: evaluate each statement to reflect to what degree you agree or disagree with
them. . .: 1 ¼ “I strongly disagree” to 10 ¼ “I strongly agree”)
JS1. I frequently think about quitting this job
JS2. I am satisfied with the kind of activities I perform everyday
JS3. Generally speaking, I am very satisfied with this job
Notes: aItems in italic are reverse-scored. bA high score indicates a greater degree of behaviour-based Table AI.
control system Scale items