AN EMPIRICAL REANALYSISOF THE SELECTION-SOCIALIZATION HYPOTHESIS

Stephen B. Scofield (deceased)

Texas A&M University - Kingsville

Thomas J. Phillips, Jr.

Louisiana Tech University

Charles D. Bailey

Background

Lawrence D. Ponemon“Ethical reasoning and selection socialization in

accounting.” Accounting, Organizations and Society 17 (1992), 239–258.

Based on his 1988 dissertation at Union College of Union University

Poneman's Socialization-Selection Hypothesis

Partners of larger CPA firms have lower levels of moral judgment than incoming auditors.

Through the promotion process, these ensconced partners weed out candidates with high ethical judgments, selecting “less ethical” persons like themselves.

Wide Acceptance of Ponemon’s Findings

Cited 22 times as of October 2001 [98 times per Google Scholar 02/07]

“passed into the accepted wisdom” – Anon. reviewer of our paper, 2001

Ponemon achieved career success– hired as partner by two Big-5 firms– Now president of a privacy/security consulting

firm

P-score does not differ across rank

P-score does not differ across rank

P-Scores do not differ across rank or Big-5 experience

Similar nonsignificant results looking just at Big 5, Table 6

Those who left Big 5 did not have higher ethical reasoning, Table 7

Power is sufficient to give confidence in nonsignificance (no large or medium difference likely exists).

Critique of Ponemon 1988/1992

Selection–socialization hypothesis is instinctively appealing.

– Many professionals have felt pressures to conform, to compromise one’s ethical code.

– To place high value on conformance to society is to move toward Kohlberg’s (1969) ‘‘conventional’’ reasoning, below the level of principled reasoning.

– In his dissertation, Ponemon (dissertation, 1988) recounts his personal experience

his ‘‘tension level to paranoiac proportions’’ in interview

Two discrepancies undermine Ponemon’s Results:

Demographics of his data differ greatly from the population from which the sample was drawn– What’s wrong?!

No effective control exists for the possible effects of firm size.

Fig. 1. AICPA membership in public practice, by firm size.

“Firms with fewer than50 professionals constitute 78% of the populationbut only 17% of the recordsin Ponemon …. Firms with more than 50professionals constitute only 22% of the populationbut make up 83% of Ponemon’s respondents…. [not] a random departure from the… AICPAmembership (Chi2=74.10, p<0.001).” (p. 547)

Ponemon’s DIT stage scores are weird!Extreme drops in Stages 4 & 5 reasoning, big increase in Stage 3. Our data are consistent between samples and reflect normal developmental expectations.

D I T S t a g e P e r c e n t a g e s , P o n e m o n 1 9 8 8 /1 9 9 2 a

0

1 0

2 0

3 0

4 0

5 0

Perc

enta

ge o

f Res

pons

es

S ta g e 2 9 .2 3 7 .1 1 4 .1 8 6 .1 6 7 .2 5

S ta g e 3 1 7 .7 0 2 2 .5 5 2 0 .0 1 3 3 .1 2 3 8 .8 8

S ta g e 4 1 8 .7 6 2 0 .6 5 2 3 .1 1 1 8 .7 6 1 4 .3 7

P 4 4 .7 1 4 2 .4 4 7 .7 4 3 5 .6 7 3 2 .1 7

S ta f f S e n io r S u p e r v i s o r M a n a g e r P a r tn e r

D I T S t a g e P e r c e n t a g e s , 1 9 9 5

0

1 0

2 0

3 0

4 0

5 0

Perc

enta

ge o

f Res

pons

es

S ta g e 2 4 .6 4 4 .0 0 2 .4 1 3 .4 8 2 .6 4

S ta g e 3 1 3 .6 3 1 5 .4 0 1 4 .1 0 1 3 .9 4 1 4 .1 1

S ta g e 4 3 7 .0 5 3 4 .7 8 3 6 .4 8 3 4 .6 9 3 9 .6 9

P 3 8 .9 0 4 0 .6 9 4 1 .3 0 4 3 .5 4 3 8 .6 2

S ta f f S e n io r S u p e r v i s o r M a n a g e r P a r tn e r

D I T S t a g e P e r c e n t a g e s , 2 0 0 1 ( D I T 2 )

0

1 0

2 0

3 0

4 0

5 0

Perc

enta

ge o

f Res

pons

es

S ta g e 2 4 .9 1 4 .8 8 4 .9 2 4 .3 5 4 .2 8

S ta g e 3 2 3 .0 9 1 9 .5 2 1 6 .2 3 1 6 .1 8 1 7 .2 0

S ta g e 4 2 6 .7 3 3 4 .8 8 3 6 .1 5 3 7 .5 0 3 9 .8 0

P 4 2 .1 8 3 7 .0 4 3 8 .1 5 3 7 .0 9 3 4 .1 7

S ta f f S e n io r S u p e r v i s o r M a n a g e r P a r tn e r

Epilogue

http://seclists.org/politech/2001/Jun/0081.html http://www.ponemon.org/index.html