The impact of business ethics on value orientation and value creation : the case of Palestine

Abstract FRE

Today there is a growing perception among enterprises that sustainable business success and shareholder value cannot be achieved solely through maximizing short-term profits but instead through marketoriented yet responsible behavior, Mahajan (May 2011).

Companies are aware that they can contribute to sustainable development by managing their operations to enhance economic growth and increase competitiveness whilst ensuring environment protection and promoting social responsibility, including consumer interest.

The business case of CSR is intensively discussed among scholars in recent years.

Globalization, environmental issues and corporate scandals have sensitized people worldwide towards the degree of social responsibility displayed by companies.

The question that can still not be answered satisfactorily is about the financial and economic impact of socially responsible corporate behaviour.

Therefore, the purpose of this paper is to investigate whether ethical values displayed by small business executives lead to financial and economic value in Palestine.

The author developed a process-oriented and outcome-oriented model which was then tested empirically.

The results indicate that there is a positive relationship between ethical issues and financial values.