Study offers strategies to thwart unethical decisions by businesspeople

October 1, 2020

In the depths of the 2008 recession, the Bank of America, having purchased Merrill Lynch, was gearing up for its largest-ever layoffs: up to 35,000 workers. It was at this cataclysmic point in time when Merrill Lynch CEO John Thain took to decorating his office to the tune of $1.2 million U.S. (ABC News). Why do people in positions of power use their authority unwisely? And what can be done about it?

The goal in this research was to determine why high-position members of organizations make unethical decisions

Justin Tan, professor at York University’s Schulich School of Business, sought to answer these questions. He led a team of researchers focused on unethical decisions in the business world and the roles of power and status in making these decisions, and compared China and Canada.

The differences between these two countries were interesting: When asked to explain the reasons behind their unethical decisions, study participants in China were more likely to cite position differences, while participants in Canada were more likely to cite work effort and personal abilities.

However, the findings have a broader impact: This new information provides key insights on behavior in workplace settings and greater understanding of unethical decision-making.

“Our findings expand research on the relationship between social hierarchy and unethical decision-making and provide practical insights on unethical behavior in organizations,” Tan explains.

Most importantly, Tan’s team offers some concrete suggestions for how to stop unethical decisions in the future.

The results of this research, funded by the National Natural Science Foundation of China and by Central South University (China), were published in the Journal of Business Ethics (2019).

Study fills important research void

Prior to this study, most research on unethical behavior in organizations looked at Western societies; comparative studies of unethical behavior across nations were rare. But Tan realized that much could be gained through a comparative analysis. “Our goal in this research was to determine why high-position members of organizations make unethical decisions,” he explains.

Tan and his team, including Chris Bell, also at York, and two academics from Central South University (Hunan, China), decided to focus on Canada and China.

The researchers had several hypotheses, including:

power is positively related to unethical decision-making;
status is positively related to unethical decision-making; and
status moderates the positive relationship between power and unethical decision-making.

Power is defined by Tan as “an asymmetrical discretion in bestowing or withholding valuable resources or outcomes” while status is defined as “the esteem and social worth that one has in others’ eyes.”

Participants were business students in Canada and China

The team recruited university business students in China and Canada with an average age of 20 years: 100 participants from China (nearly 60 per cent were women) and 83 from Canada (50 per cent were women).

The participants completed a pen-and-paper survey. Tan explains further: “We conduct a scenario experiment, using a role-playing game to capture participants’ unethical decisions.”

The researchers set up various scenarios, such as:

You have been appointed to be the supervisor of your workgroup. You have three subordinates. You have control over an unusually large amount of resources, compared with your peers who head other workgroups. After completing the task, you will have four distribution options for bonus allocation.

Power and status play role in unethical decisions

The findings showed how much power and status influence unethical decisions, although there were some differences. “Chinese participants showed a positive correlation between need for power and unethical decisions, and Canadian participants showed a positive correlation between status and unethical decisions,” Tan explains.

When questioned about why they made unethical decisions, 90 per cent of the participants (Canada and China together) provided rationales. Chinese participants are more likely to cite position differences, whereas Canadian participants are more likely to cite work effort and personal abilities.

Practical implications

To focus on the differences between the two countries would be missing the larger point of Tan’s work. The practical implications of this research lead to prevention strategies that could be applied in any organization, country or setting.

Tan’s team provides three main suggestions to prevent unethical decisions:

Organizations should guide higher-ranking members’ perceptions of their superior positions and their cognizance of their own behaviors and the effects on others.
Organizations should address the use of discretion by high-ranking personnel because more discretion facilitates greater opportunities to engage in unethical decision-making. If clear regulations were established around discretion, then organizations could reduce the incidence of unethical behavior.
Managers who wish to prevent unethical behavior should watch out for position- or performance-based superiority, which could induce unnecessary entitlements in reward distribution and lead to unethical decisions.

To read the article, “How Do Power and Status Differ in Predicting Unethical Decisions? A Cross-National Comparison of China and Canada,” visit the journal’s website. To learn ore about Tan, visit his Schulich profile page.

To learn more about Research & Innovation at York, follow us at @YUResearch; watch our new video, which profiles current research strengths and areas of opportunity, such as Artificial Intelligence and Indigenous futurities; and see the snapshot infographic, a glimpse of the year’s successes.

By Megan Mueller, senior manager, Research Communications, Office of the Vice-President Research & Innovation, York University, muellerm@yorku.ca

Welcome to YFile’s New Faces Feature Issue, part two

September 24, 2020

Welcome to YFile’s New Faces Feature Issue 2020, part two. In this special issue, YFile introduces new faculty members joining the York University community and highlights those with new appointments.

The New Faces Feature Issue 2020 was presented in two parts: part one on Friday, Sept. 11 and part two on Friday, Sept. 25.

In this issue, YFile welcomes new faculty members in the Faculty of Liberal Arts & Professional Studies; the Lassonde School of Engineering; Osgoode Hall Law School; the Schulich School of Business and the Faculty of Science.

Faculty of Liberal Arts & Professional Studies expands with 35 new faculty members

Five new faculty members join Lassonde School of Engineering

Osgoode Hall Law School welcomes two new faculty members

Schulich School of Business introduces four new faculty members this fall

Faculty of Science welcomes nine faculty members this fall

The Sept. 11 issue included the School of Arts, Media, Performance & Design; the Faculty of Education; Glendon Campus; and the Faculty of Health.

Note: There are no updates in the Faculty of Environmental and Urban Change.

New Faces was conceived and edited by Ashley Goodfellow Craig, YFile deputy editor, Jenny Pitt-Clark, YFile editor and Aaron Manton, communications officer

Schulich School of Business introduces four new faculty members this fall

September 24, 2020

The Seymour Schulich Buildiing, home of the Schulich School of Business

This story is published in YFile’s New Faces Feature Issue 2020, part two. Every September, YFile introduces and welcomes those joining the York University community, and those with new appointments. Part one was published in the Sept. 11 edition.

Four new professors will join the Schulich School of Business this fall: Pouyan Foroughi, Ivona Hideg, Raha Imanirad and Guangrui (Kayla) Li.

“The Schulich School of Business is pleased to welcome these four highly accomplished management scholars to our Faculty,” said Schulich Interim Dean Detlev Zwick. “Their expertise in the fields of finance, organization studies and operations management and information systems will enhance the high-calibre research and teaching at our School.”

Pouyan Foroughi

Pouyan Foroughi is an assistant professor of finance at Schulich School of Business, York University. He completed his PhD in finance at Boston College in 2017. His main research interests include empirical corporate finance, corporate governance and the role of financial institution in capital markets.

His research has won best paper awards at WFA-CFAR conference, Western Finance Association (WFA) and Midwest Finance association (MFA). His teaching focuses on corporate governance and corporate finance at the undergraduate and the postgraduate levels.

Ivona Hideg

Ivona Hideg is an associate professor and holds the Ann Brown Chair in Organization Studies at Schulich. Prior to joining Schulich, she held a Canada Research Chair (Tier II) in Organizational Leadership at the Lazaridis School of Business and Economics, Wilfrid Laurier University, and spent the past year as a Research Fellow with the Women and Public Policy Program at the Harvard Kennedy School. She completed her PhD in organizational behaviour and human resource management at the Rotman School of Management, University of Toronto.

Her research interests include gender equality and diversity in the workplace, as well as diversity policies promoting women and racial minorities, and the underrepresentation of women in leadership positions. She currently serves as an associate editor of the Academy of Management Journal.

Raha Imanirad

Raha Imanirad is an assistant professor of operations management at Schulich. She completed her PhD in technology and operations management at Harvard Business School and is a Schulich MBA graduate from the Class of 2010. While at Harvard, she was a Teaching Fellow for the Technology and Operations Management core MBA course.

She is currently conducting research together with several other colleagues on emergency department physician scheduling.

Her areas of research include data envelopment analysis, healthcare operations management, and behavioural operations management.

Guangrui (Kayla) Li

Guangrui (Kayla) Li is an assistant professor of operations management and information systems at Schulich. She completed her PhD in information systems at the School of Business and Management at Hong Kong University of Science and Technology (HKUST). While at HKUST, she taught an undergraduate course on “Data Mining for Business Analytics”.

She is currently conducting research with another academic on “the impact of anonymity on piracy.” Her areas of research interest include algorithmic impacts/machine behaviour, social media, data piracy and big data applications.

Schulich Professor Yelena Larkin wins European Finance Association Award

September 23, 2020

Yelena Larkin FEATURED image for YFile

A Schulich professor’s research on concentrated U.S. product markets recently won the Pagano & Zechner Prize for the best non-Investments paper published in the Review of Finance journal in 2019-20. Yelena Larkin has received the award for her work “Are US Industries Becoming More Concentrated?” on behalf of her co-authors at the European Finance Association 2020 annual meeting.

“Today we live in a world in which a handful of ‘superstar firms’ have grown to dominate their industries. Importantly, this is not a purely high-tech phenomenon: the increase in concentration affects around three-quarters of the U.S. industries,” said Larkin.

“The COVID outbreak has only exacerbated the trend. While many smaller businesses have closed their doors potentially forever, Apple has reached a new high of $2 trillion market cap. Currently, just five companies – Amazon, Apple, Facebook, Netflix and Google parent Alphabet – make up about a quarter of the S&P 500’s value and 50 per cent of the NASDAQ’s value.”

Larkin believes further research needs to be done. The rise in concentration is linked to higher profits, which, in turn, are transferred to shareholders in the form of high stock returns. Combined with other evidence, it is difficult to think of a scenario under which the increase in concentration and higher profit margins, enjoyed primarily by the shareholders, represents an overall economic improvement.

“This award proves the profession finds my research relevant and impactful. It is precious to know that my excitement and faith in the main message of this research work are recognized and shared by others,” Larkin said.

Schulich professor researches aversion to stockpiling during pandemic

September 20, 2020

Do you remember the beginning of the pandemic, when you couldn’t find toilet paper or Lysol wipes anywhere?

Research co-authored by Schulich Professor M. Johnny Rungtusanatham finds that shortages within supply chains are not only due to increased demand, but also to companies not stockpiling products. The research paper “Managing Critical Spare Parts within a Buyer–Supplier Dyad: Buyer Preferences for Ownership and Placement” appeared earlier this year in the Journal of Business Logistics.

“Shortages experienced is not just due to sudden demand spikes but also because of aversion to stockpiling,” said Rungtusanatham, Canada Research Chair in Supply Chain Management. “Not stockpiling is actually sage advice over the last two decades, especially for goods with low supply uncertainty.”

The research found that buyers have a strong preference for consignment-based inventory management approaches, thereby decoupling inventory ownership and inventory placement responsibilities. Companies can only have so many items on the shelves in their stores, therefore when consumer demand suddenly increases it is difficult to meet that demand not having instant access to additional products.

One industry where aversion to stockpiling is notable is airplane parts, due to the cost of inventory. This has a direct impact on supply chains; if a plane needs to stay grounded while it is repaired products cannot be moved as a result.

The research also suggests that buyers have a bias against inventory speculation despite its use in practice and analytical models, and a strong preference for inventory postponement when the level of supply uncertainty is low.

While new students prefer in-person learning, they are adapting well to online learning

September 17, 2020

Featured image shows two students looking directly at the camera

There’s no doubt about it: both Adrianna Bonavota and Mishal Vellani would prefer to be sitting in classrooms on the Keele Campus this month, but they accept that online classes are the way of the world today.

Bonavota is a first-year accounting student at the Schulich School of Business who lives in Vaughan, a 20-minute commute from the campus, while Vellani is a first-year earth and atmospheric science student at the Lassonde School of Engineering who lives in Kampala, Uganda. Although they are presently oceans apart, they have both been busy on Zoom lately, taking part in Orientation Week activities at York and beginning their first year of university classes.

“Orientation Week was kind of challenging because it was all online, but it was fun,” said Bonavota. “We had Zoom calls, did baking and dancing – all things you could do together alone.”

Vellani first attended a virtual party hosted by York International (YI), the hub for all things international at the University, and soon she found herself volunteering as a host for YI’s virtual events and joining in their virtual coffee breaks.

“York International is pretty cool,” Vellani said. “Because of the coffee breaks, I met more people to talk to and became part of some What’s App groups. I thought that when I attended school in Canada, I’d meet Canadians, but there’s so much diversity. I’ve met students from so many different countries already and learned about different cultures.”

Bonavota was a bit apprehensive about remote classes, but she is finding her rhythm.

“When we studied online in high school, I was as self-disciplined as I would have liked and procrastinated,” she said. “I feel as if it would be easier to push myself if I were in class physically, but the groups of friends I made during Frosh have all been pushing ourselves.”

It also doesn’t hurt that she and her best friend from high school are both in the accounting program and chose all of the same classes.

“We study together and take some of our classes together,” she said.

For Vellani, one of the biggest challenges of online classes may be the time difference; Kampala is seven hours ahead of Toronto, so her early classes begin at 3:30 p.m.

“I did Frosh Week, and events that began at 8 p.m. started at 3 a.m. here,” she said. “I just slept until noon. I guess my body clock is adjusting.”

Fortunately, not all of her classes are synchronous, so she’ll have some flexibility.

“Our professors are really trying and are accommodating. For our exams, they give us a 12-hour time period in which to take the exam, so anyone around the world will be okay.”

The technology itself doesn’t worry her, but internet connectivity could be an issue.

“I adapted fast to technology and learned to use Zoom in high school,” Vellani said. “Now, I’m getting used to eClass and the social media platforms. I’m more worried about internet connectivity, because it could cut out at any time. I’m very glad all the classes are being recorded.”

Bonavota is finding the workload heavy, especially since her classes require a lot of reading and note-taking in preparation for remote lectures. However, it never occurred to her to delay the first year of university until she could attend live classes.

“Taking a gap year would have been a setback,” Bonavota said. “This way, I’m still in the same year as the others my age.”

She is taking five courses: four required classes and a fascinating elective, American Sign Language.

“My best friend and I wanted to learn a language together so we could communicate differently,” Bonavota said. “It’s very cool. Our professor is deaf, so we had an interpreter for the first class, but now we don’t. It’s a completely silent class – we watch the PowerPoint presentation. I’m really enjoying it; we’re already signing the alphabet and our names.”

As much as she enjoys it, it won’t change her mind about pursuing an accounting career.

“I plan to get my Chartered Professional Accountant (CPA) designation,” Bonavota said. “I love math and numbers come easily to me.

“I love learning. Just opening a textbook and making notes is fun.”

Vellani’s ultimate goal is to work for NASA.

“I always wanted to be someone who has the opportunity to go to outer space,” she said. “I want to know what’s outside our world, see God’s creations and explore where I live.”

They’re off to a good start at York and, meanwhile, using the online tools at their disposal, they’re building a strong sense of community.

By Elaine Smith, special contributing writer to Innovatus

Schulich’s McEwen Building receives OAA 2020 Design Excellence Award

September 13, 2020

The Rob and Cheryl McEwen Graduate Study & Research Building at the Schulich School of Business, York University, has been named a recipient of The Ontario Association of Architects (OAA) 2020 Design Excellence Awards.

“We are very pleased to have external peer review confirm that we have achieved a very high standard of accomplishment for the McEwen Building, as this was always our intent,” said James McKellar, professor of real estate and infrastructure, and associate dean, external relations.

The biennial OAA Awards program recognizes and celebrates building projects that demonstrate architectural excellence, creativity and sustainable design. A jury of design and architecture experts selected 10 winners. Each of the 10 award-winning projects will be showcased later this month on OAA’s YouTube channel. Members of the public will be able to vote for their personal favourite and the top selection will receive a People’s Choice Award.

Designed by the international architectural firm Baird Sampson Neuert Architects, the Rob and Cheryl McEwen Graduate Study & Research Building is one of the most environmentally sustainable academic buildings in North America. The $50-million building has a number of leading-edge technical features at the forefront of environmental sustainability, including a 27-metre high solar chimney for radiant heating and cooling, a green roof and rainwater recapture system.

This year’s award recipients will be honoured during a special online Celebration of Excellence taking place on Oct. 1.

For more information, please https://www.canadianarchitect.com/winners-announced-for-the-2020-oaa-design-excellence-awards/.

Project management students can be agents of change in pandemic recovery

September 7, 2020

Panorama of Toronto skyline at sunset in Ontario, Canada

Ushnish Sengupta, an instructor at the Schulich School of Business, wants students to be agents of change, and part of post-COVID-19 recovery planning for the City of Toronto.

In light of this perspective, his summer project management course – MGMT 4700 – provided students with an opportunity to create projects geared toward meeting the requirements of the Toronto Society of Architects’ Main Street Design Challenge, in which participants are invited to develop innovative, responsible, sustainable and resilient design solutions for Canadian main streets that can be implemented during the recovery and post-pandemic.

Alina Mirza

Sengupta believes experiential education projects, which apply knowledge learned from the classroom to real life contexts, are still possible during COVID-19. In his course, he encouraged students to take advantage of tools like Google Maps and socio-economic Open Data available from the City of Toronto in place of traditional physical site visits typically used to develop these kinds of projects.

Students in Sengupta’s class created projects ranging from the redesign of a community park with a playground, solar panels and a green roof, and a makerspace at a Scarborough library, to projects which will fill the gap in under served areas in the city of Toronto based on student research.

Milena Chikhalina

“I am pleased to see the quality creativity, and practicality of student projects and solutions created based on research and application of course project management principles,” Sengupta said.

While all students have been encouraged to, one group – Alina Mirza, Milena Chikhalina, Aishwarza Das and Sara Jamalian – formally submitted their project, titled “Revamping Ephraim’s Place Community Centre,” to the Main Street Design Challenge and received a positive response.

Aishwarza Das

“The project management course provided us with a strong foundation of knowledge regarding project management skills, terms and processes,” said Mirza. “An in-depth understanding of these concepts allowed us to approach the Main Street Design Challenge in a well-informed manner, considering the many factors that play a role in successful projects.”

Accepted submissions receive inclusion in the Main Street Design Playbook, to be released on Oct. 15 for World Architecture Day, in addition to promotional and media exposure across Canada and acknowledgement in Canadian Urban Institute, Royal Architectural Institute of Canada, and Bring Back Main Street communications and news.

Sara Jamalian

“Having the opportunity to incorporate a class project into an external challenge has allowed us to apply and enhance our knowledge in a real-world setting,” Mirza explained. “There’s always a gap between theoretical knowledge and actual application, so participating in the Main Street Design Challenge encouraged us to think critically about real-life complexities and how we would adapt to them to ensure project success. It’s definitely been a valuable and rewarding experience.”

Sengupta says instructors have to be willing to take risks with experiential learning and experimental projects. He argues that, while in some cases taking such risks will generate impressive results such as recognition in a competition, in other cases acceptance of failure is part of the learning process.

“I hope both faculty and students are encouraged to implement experiential learning projects that can be completed remotely during the COVID-19 pandemic,” Sengupta said.

Revamping Ephraim’s Place Community Centre blueprint

New CPA Ontario Centre in Digital Financial Information launches at Schulich

August 30, 2020

In partnership with the Chartered Professional Accountants (CPA) of Ontario, the Schulich School of Business has announced the creation of the new CPA Ontario Centre in Digital Financial Information. Funded by CPA Ontario, this three-year project will address emerging and topical issues that are deeply relevant to the accounting profession, as well as academic and industry audiences.

The creation of the Centre aims to advance the accounting profession and focuses on building digital financial expertise, delivering and disseminating exceptional research and thought leadership, and growing the network related to digital accounting information.

Schulich’s global research eminence and strengths in management accounting combined with relevant expertise in related areas such as big data, data analytics, artificial intelligence and responsible business make this strategic partnership ideally suited to exploring the subject of digital accounting leadership.

“Schulich is proud to be a co-founder of the new CPA Ontario Centre in Digital Financial Information,” said Detlev Zwick, interim dean. “We look forward to working together with CPA Ontario, a longstanding corporate partner of our School, in advancing research innovation in the rapidly growing field of digital accounting.”

The new Centre will also be guided by an advisory board that includes Schulich alumni with a CPA designation to provide input and guidance on how the intended uses for the funding are implemented.

The partnership between CPA and Schulich has spanned more than three decades – from establishing the CPA Chair in International Entrepreneurship to co-founding the Schulich Centre for Global Enterprise. CPA Ontario continues to help strengthen Schulich’s global reputation as a top destination for business education and thought leadership.

“Schulich has a rich history in conducting research that supports the advancement of the accounting profession,” said Craig Smith, executive vice-president of Member and Student Services at CPA Ontario. “We look forward to embarking on this new partnership and further exploring the topics of digital accounting in leadership.”

Schulich Executive Education Centre (SEEC) builder Alan Middleton to retire

August 30, 2020

Alan Middleton, executive director of the Schulich Executive Education Centre (SEEC) and distinguished adjunct professor of marketing in the Schulich School of Business, is retiring after a 19-year career.

Schulich Interim Dean Detlev Zwick made the announcement earlier this month. “I don’t know how many times I had to tell a journalist asking for some commentary that the best person to speak to about this is Alan. Alan always delivered, too. What I have always valued and admired about Alan is that everything he did – teaching, running SEEC, media commentary, etc. – he did to benefit and support Schulich, his students and his colleagues and staff. He’s the epitome of a team player. I and Schulich will miss him greatly.”

Middleton, who earned his MBA at Schulich in 1977, came back to the school in 1991 to earn his PhD after a 25-year career, during which he worked as a marketing practitioner with Esso Petroleum, UOP Inc.; the executive vice-president of J. Walter Thompson (JWT) worldwide; and president/CEO of JWT Japan. Before becoming an assistant professor at Schulich in 1998, Middleton taught at Rutgers Graduate School of Business in the U.S. and at business schools in Argentina, China, Russia and Thailand.

In September 2001, he took over as executive director of the Schulich Executive Education Centre (SEEC), which trains more than 16,000 managers and executives domestically and internationally.

Schulich Associate Dean, External Relations, James McKellar, a professor of real estate and infrastructure, worked with Middleton to open the Miles S. Nadal Management Centre, located at King and Bay streets in the heart of Toronto’s Financial District, in 1995, as well as the Executive Learning Centre at York’s Keele campus in 2003.

It was, McKellar said, “an interesting journey that reflects the many achievements of Schulich. Alan directly contributed to one of these achievements that is close to my heart and that is Art@Suite 500 … to which Alan has contributed his time and support over these many years. This is but one small example of Alan’s many contributions to the success of the Schulich School.”

As an educator, Middleton taught in Schulich’s MBA and BBA programs, with a focus on international marketing, marketing communication and brand management.

Jane-Michèle Clark, program director of SEEC’s Master’s Certificate in Marketing Communications and a marketing instructor in Schulich’s MBA program, highlighted his many years of success as a teacher. She said students often talk about how much they enjoy Middleton’s classes and admire his “depth of knowledge on many, wide-ranging topics” and his ability to be both thought-provoking and provoking.

Middleton is the author of several publications, including the books Advertising Works II and Ikonica – A Fieldguide to Canada’s Brandscape, and published papers for the ACA/ICA on marketing communications ROI, client-agency compensation strategies and client-agency relations.

He is a co-founder of the ‘CASSIES’ advertising awards, a member of the Academic Committee of Leger Marketing and was inducted into the Canadian Marketing Hall of Legends in the mentor category in 2005.

In 2015, Middleton received the International Association of Business Communicators Toronto Communicator of the Year Award. He is also the recipient of the Queen Elizabeth II Diamond Jubilee Award for services to literacy in 2012, the same year he received a gold medal from the Association of Canadian Advertisers.

Accolades for Middleton in a special online guest book created for his retirement were many, from his staff at SEEC to his colleagues in industry and at Schulich, and noted his generous spirit, his mastery of advertising and marketing and the legacy he leaves as a builder.

Elaine Gutmacher, who for many years worked alongside Middleton as SEEC’s director of operations, said that under his guidance “SEEC grew and thrived, creating new and innovative programs.”

He was commended for developing “a generation of leadership among all areas of the media sector” and for being “full of ideas and imagination” by Trina McQueen, Schulich’s first Bell Media professor in media management.

“For me, he is the spirit of Schulich: open, fearless, smart and always dedicated to excellence,” she said.

Zwick has also announced that SEEC Managing Director Rami Mayer (Schulich iMBA ‘02) has been appointed SEEC executive director, effective Sept. 1. Mayer is also a graduate of York University (BA ’00) and the Australian Graduate School of Management (MBA ’02).

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