Search

In recent years, we have experienced some revival of society's concerns with the ethics of business practices as a result of several scandals. However, severe competitive pressures seem to continue to force executives to resort to marginally ethical ways that would provide knowledge about competitors' operations. Therefore, an empirical study was conducted during Spring and Summer of 1991 about information gathering methods by businesses regarding operations of competitors. Respondents were employed in a variety of different industries. A convenience sample was administered in two adjoining states, with one group residing in an urban city and the other in smaller predominantly rural communities. Analysis of perceptions held by these two groups supports the hypothesis that rural residents tend to be more conservative and less approving of questionable methods of information gathering. Similarly, within each group and in the sample as a whole, differences in condoning or disapproving information gathering methods were discovered on the basis of demographic characteristics of respondents.

Competitor intelligence, information that helps managers understand their competitors, is highly valued in today's marketplace. Firms, large and small, are taking a more systematic approach to competitor intelligence collection. At the same time, information crimes and litigation over information disputes appear to be on the rise, and survey data show widespread approval of unethical and questionable intelligence-gathering methods. Despite these developments, few corporations address the ethics of intelligence gathering in their corporate codes of conduct. Neither managers nor management educators have paid sufficient attention to this topic. From a review of questionable intelligence-gathering practices reported in various literatures, the author identifies some important ethical principles to help managers draw the line between legitimate and illegitimate methods of information acquisition. The paper also discusses the costs of failure to heed these principles and suggests steps managers can take to provide ethical leadership in this area.