J Bus Ethics (2015) 130:4557

DOI 10.1007/s10551-014-2195-7

Managerial Tolerance of Nepotism: The Effects of Individualism

Collectivism in a Latin American Context
Guillermo Wated Juan I. Sanchez

Received: 30 September 2013 / Accepted: 17 April 2014 / Published online: 10 May 2014
 Springer Science+Business Media Dordrecht 2014

Abstract This study proposes and tests a model that

integrates culture, attitudes, subjective norms, and attributions into a theoretical framework that explains tolerance
toward nepotism in a Latin American country. The participants were 202 Ecuadorian middle and upper managers.
The results suggested that attitudes, subjective norms, and
attributions significantly predict managerial intention to
discipline those employees who favored a family member
when hiring. Furthermore, subjective norms and internal
attributions mediated the relationship between culture and
intentions to discipline employees who engaged in nepotistic acts. Our findings highlight the need to implement
culture-congruent HR practices to effect mission-driven
changes in talent management practices.
Keywords Attitudes
Attributions
Counterproductive
work behaviors
Culture
Latin America
Nepotism

Theory of planned behavior

Introduction
At the onset of the 21st century, nepotism continues to be
probably as relevant a phenomenon as it was around the
fourteenth century when the term was arguably first coined

G. Wated (&)
Psychology Department, Barry University, 11300 N.E. Second
Ave, Miami Shores, FL 33161, USA
e-mail: gwated@barry.edu
J. I. Sanchez
Department of Management and International Business, Florida
International University, 11200 S.W. 8th St, RB 310, Miami,
FL 33199, USA
e-mail: sanchezj@fiu.edu

to describe the appointment of the Popes relatives to office

(Bellow 2003). Nepotism is broadly defined as an agents
preferential treatment provided to relatives and close
friends in practices such as hiring. This preferential treatment is of course driven by the relationship between the
agent and the beneficiary rather than by merit (Jones 2006).
The pervasiveness of nepotism across nations is highlighted by several authors. Boutilier (2009) pointed out that
nepotism continues to be a global phenomenon despite the
pressure asserted by economic globalization forces to use
merit-based approaches in hiring and promotion. Likewise,
Bellow (2003) suggested that several sectors of the
American society, including Fortune 500 companies, the
movie industry, and the political class, have embraced
nepotism (see Eligon 2012 for a recent example). In
Eastern European nations, Kovriga (2001) called for a
restoration of merit-based hiring and promotion practices.
More specifically, Gajduschek (2007) indicated that
behind the large merit-like legal facade there is a system
that allows almost direct and unrestrained political influence (p. 351) in the Hungarian bureaucracy. Sotiropoulos
(2004) exposed how merit-based practices are undermined
in certain Southern European countries. In Asian countries,
close social connections (e.g., guanxi) heavily influence the
allocation of resources (Brand and Slater 2003; Wong and
Chan 1999; Zhang and Li 2003). For instance, Martinsons
and Davison (2007) found that Chinese managers were
more likely to be influenced by the applicants group
background and social relations than by personality factors
during the hiring process. Similarly, nepotism may extend
to social connections in the Arab world (Al-Ali 2008). The
importance given to family connections in the Arab world
is actually highlighted by the term wasta; a word widely
used to indicate the use of social connections to reach
desired outcomes (Sidani and Thornberry 2013), and in

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Latin America, there is a strong tradition of favoring family

and close friends in the hiring process as well as in distributing wealth and resources (Boutilier 2009).
In spite of its presumably universal existence, nepotism
is certainly shaped by cultural values, some of which may
influence the extent to which nepotism is tolerated in
organizations. We propose a model that outlines how cultural factors may play a role in managers tolerance of their
subordinates nepotism. The study described herein tests
our models contention that cultural values allow for a
better understanding of the phenomenon. We conclude by
discussing the theoretical and practical implications of our
findings including the effectiveness of organizational procedures intended to curtail the practice of nepotism.
Dominant cultural values represent part of the environment that managers must filter through their experience and
education to arrive at a set of ideals (Wines and Napier
1992). Latin American countries share common cultural
values, which link them together through a common set of
core principles. Hence, it can be argued that dominant
regional cultural values such as collectivism may predispose managers to tolerate nepotism across Latin America.
IndividualismCollectivism (IC) captures the nature of
the relationship between the individual and society, with
individualism pertaining to societies with loose ties among
ingroups (Hofstede 2001). In contrast, the emphasis on
interdependence among ingroup members in collectivistic
societies may trigger employment decisions that promote
ingroup favoritism.
Furthermore, a Latin American country was chosen as
the setting of the present study because of the allegedly
pervasive influence of family ties in the allocation of
resources in the region (Boutilier 2009). A better understanding of the local managers judgments toward their
subordinates engagement in nepotism may help enhance
our understanding of the process through which Latin
American managers become more tolerant toward nepotism. Thus, our study contributes to a growing body of
organizational behavior research aimed at uncovering the
roots of nepotism in regions where social connections and
family ties are culturally salient.
From a merit-based perspective, the practice of nepotism may be regarded as unethical since it involves the
abuse of power in favor of family members. Consequently,
tolerating nepotistic practices may lead to the transgression
of both procedural and distributive justice in the workplace,
thereby provoking withdrawal, dissatisfaction or, possibly
worse, instigating counterproductive behavior among the
least-favored employees (Colquitt et al. 2005). For
instance, Arasli et al. (2006) found that the practice of
nepotism had a negative impact on job satisfaction and on
quitting intentions among Turkish-Cypriot hotel employees. Furthermore, Arasli and Tumer (2008) documented

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G. Wated, J. I. Sanchez

Attitudes

Subjective
Norms

Collectivism

Intention to Tolerate
Nepotism

Attributions

Fig. 1 Model predicting managers tolerance toward nepotism

nepotisms negative impact on not only job satisfaction but

also employee-related stress among banking employees in
Northern Cyprus.
Despite anecdotal evidence of its allegedly widespread
existence and presumably negative consequences, few
studies have researched the phenomenon of nepotism
within a theoretical framework in an organizational context. In fact, Jones (2012) pointed out that a PsychInfo
search employing the keywords nepotism and organization
yielded no more than 27 articles (including studies about
animal behavior). We hope that the model that we introduce here will begin to fill this gap in the organizational
literature. Next, we outline the proposed process model
(see Fig. 1) that explains managerial tolerance toward
employees acts of nepotism.

Theoretical Model and Hypotheses Development

The theoretical model described herein draws from Ajzens
(1991) theory of planned behavior (TPB). However, the
model makes a number of original contributions, such as
placing culture, more specifically IC, at the forefront. It
further draws from attribution theory to shed light into
managers intentions to tolerate nepotism in organizations.
As Ajzen noted, the TPB is, in principle, open to the
inclusion of additional predictors if it can be shown that
they capture a significant proportion of the variance in
intention or behavior after the theorys current variables
have been taken into account (1991, p. 199). As such,
revisions to the TPB have not been uncommon, and
extended versions incorporating domain-specific predictors
with the expectation to improve the prediction of intentions
and behavior have been postulated by several authors (e.g.,
Knowles, Hyde and White 2012; Rocheleau 2013; Smith
and McSweeney 2007).
The goal of the theories of reasoned action and its
successor, TPB, is to provide a model to better understand
and predict human behavior (Ajzen 1991). Fishbein and
Ajzen (1975) stated that the best predictor of behavior is

Managerial Tolerance of Nepotism

the strength of the intention to perform it. This proposed

use of intention as a proximal measure of behavior is one of
the most important contributions of the TPB model
(Francis et al. 2004), in spite of the fact that the relationship between intention and actual behavior is admittedly
imperfect. According to the TPB (Ajzen 1991), behavioral
intention is jointly determined by three factors: the attitude,
the subjective norm, and the perceived behavioral control
toward the behavior. The attitude toward the behavior
refers to the degree to which a person values (positively or
negatively) the performance of the behavior (Ajzen and
Fishbein 1980). The subjective norm aspect deals with the
perceived social pressure that individuals experience
regarding whether or not to engage in the behavior. Perceived behavioral control is the individual belief about
available resources and opportunities that increase or
reduce the difficulty of performing the behavior (Ajzen and
Madden 1986).
Several meta-analyses attest to the usefulness of the
TPB in predicting not only behavioral intentions but also
actual behavior (e.g., Armitage and Conner 2001; Godin
and Kok 1996). For instance, Armitage and Conner (2001)
found that the TPB variables accounted for 39 % of the
variance in intention and 27 % of the variance in a range of
behaviors. Furthermore, multiple studies have applied TPB
specifically to ethical decision making both in and outside
of the workplace (e.g., Henle et al. 2010; Kurland 1996;
Stone, Jawahar and Kisamore 2009). Taken together, these
studies support the use of the TPB as a useful framework to
study managers intentions to discipline employees who
have engaged in nepotism.
In our proposed model, the TPB was modified by
expanding Ajzens (1991) notion of perceived behavioral
control in the context of Heiders (1958) attribution theory.
Specifically, attribution theory expands the notion of control by distinguishing between internal (i.e., caused by the
person) and external (i.e., caused by the context) attributions. The degree to which a cause is perceived to be under
the control of an actor (i.e., an internal cause) has implications for the observers expectations and future behavior
(Weiner 1986). If the observer considers an actors negative behavior to be the result of uncontrollable external
causes, then the observer tends to interpret the actors
behavior more positively. On the other hand, if the observer considers an actors negative behavior to be the result
of controllable internal causes, then the observer has the
tendency to construe the actors behavior in a rather negative light. For instance, Green and Mitchell (1979)
asserted that leaders would reprimand subordinates actions
that led to failure most severely when subordinates were
perceived to have lots of control over a situation. Similarly,
managers who perceive their followers acts of nepotism to
be the result of internal causes (e.g., to gain status within

47

their own families) may also tend to punish it more

severely than those who perceive it to be the result of
external causes such as helping a family member in hardship (Ajzen 1991; Weiner 1986). Hence, it is hypothesized
that
Hypotheses 1a and 1b Managers will be most likely to
discipline an employee who favored a family member
during the hiring process when (1a) they hold a positive
attitude toward disciplining an employee who favored a
family member, and (1b) they believe that relevant people
in their lives think they should discipline an employee who
favored a family member during the hiring process.
Hypothesis 2 Internal and external attributions about
nepotism will predict managers intention to discipline an
employee who favored a family member during the hiring
process beyond attitudes and subjective norms. Whereas
internal attributions will be positively related to the
intention to discipline an employee, external attributions
will be negatively associated with such an intention.
There are reasons to believe that the IC dimension
plays an important role in managers intentions to tolerate
nepotism. Dominant cultural values such as collectivism
are part of the social environment that individuals integrate
into their experiences to arrive at decisions regarding
behavior at work (Yang et al. 2012). Indeed, it has been
well documented that employees appraisals of work conditions are impacted by cultural values such as IC (Chun
et al. 2006; Taras et al. 2010; Taras et al. 2011). Nevertheless, the specific mechanism through which culture
impacts behavior is still not well understood. We argue
here that collectivism impacts managers intentions to
tolerate nepotism through attitudes, subjective norms, and
attributions.
According to social identity theory, individuals tend to
not only perceive members of their ingroup in more
favorable terms but also favor them regardless of the
fairness associated with the decision (Tajfel 1984; Turner
et al. 1979). This tendency toward ingroup identification
could be particularly salient among collectivists who
greatly value group solidarity and stable friendships (Kim
et al. 1994). For instance, it has been documented that
collectivists are inclined to have a more positive attitude
toward ingroup than toward out-group members, adhere to
social norms that foster ingroup membership and favoritism, as well as give more generous reward allocations to
those who are perceived to be ingroup members (Leung
and Bond 1984). People in collectivistic cultures also tend
to belong to a few select ingroups, such as family and
friendship circles, with whom duties and obligations are
critically intertwined (Triandis et al. 1988). For example,
Diaz-Saenz and Whiterspoon (2000) found that employees

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in Mexico seem to base their work-related decisions on

family needs. Moreover, Davila and Elvira (2005) specifically note that in Latin America, work is seen as the means
to ones goal of providing a good quality of life for the
employees family (p. 15). The fact that collectivists
generally favor their ingroup is also illustrated by a wellknown Latin American saying that states A los amigos
todo, a los enemigos nada, al extrano la ley (Everything
for my friends, nothing for my enemies, the law for
strangers).
Thus, it seems fair to conclude that Latin American
managers are, on the average, more likely to hold a positive
attitude toward their subordinates appointment of relatives
and friends, regardless of their merits, than managers from
less collectivist regions. Their attitudes would presumably
be based on the belief that such an appointment will not
only benefit a member of the employees ingroup but also
open up the doors to a trustworthy new employee. The
same principle would apply to the perception of subjective
norms, that is, these managers also believe that most of the
people they respect would be tolerant of an employee who
favored a family member when hiring.
The making of internal or external attributions, however,
is also heavily influenced by cultural factors such as the I
C dimension (Hofstede 2001). Collectivists place a high
value on interpersonal harmony and interdependence
(Fischer et al. 2009). These values suggest that ones
behavior is principally determined by a group-oriented self.
On the other hand, individualists place a high value on
autonomy, competitiveness, individual achievement, and
self-sufficiency (Markus and Kitayama 1991), which predispose them to make internal attributions (Spector et al.
2002). Therefore, there are reasons to believe that collectivist managers will attribute subordinates favoritism
toward family and friends to allegedly legitimate factors
such as group solidarity rather than internal factors such as
egotistic goal pursuit or a self-centered orientation.
Furthermore, both Hofstede (2001) and Triandis (1995)
pointed out that collectivists are more sensitive to their
environments. In contrast, individualists are more selfcentered than collectivists and, unlike collectivists, they
expect the environment to be sensitive to them (Fischer
et al. 2009). This finding further suggests that collectivistic managers will be more prone to recognize the
practical benefits of nepotism than those who endorse
individualistic principles. Moreover, several streams of
research in cross-cultural settings also suggest that IC is
related to the attribution of internal and external causes of
nepotism. For instance, Stevenson and Stieger (1992)
concluded that whereas collectivistic East Asians associated achievement with context-specific factors, individualistic Americans associated achievement with internal
dispositions.

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G. Wated, J. I. Sanchez

Culture may indeed play a role as an antecedent of

nepotism by impacting managers attitudes, subjective
norms, and external attributions. After all, societies
develop different cultural solutions to basic problems due
to idiosyncrasies in their physical, historical, and socioeconomic situation. These factors impact not only the way
individuals relate to one another but also their entire
decision-making processes (Chun et al. 2006; Taras et al.
2010, 2011; Yang et al. 2012). Thus, it is hypothesized that
Hypothesis 3 Attitudes, subjective norms and external
attributions will mediate the relationship between collectivism and intentions to discipline an employee who
favored a family member during the hiring process.
Whereas intention, attitudes and subjective norms will be
negatively associated with collectivism, external attributions will be positively associated with collectivism.
The hypothesis stated above implies that IC is used to
explain differences among individuals despite Hofstedes
(1980) assertion that IC is generally regarded as a cultural-level construct best measured at the national level.
Nevertheless, it is becoming increasingly clear that neither
cultures nor their members are purely collectivistic or
individualistic. Triandis (2001) stated that it should not be
assumed that everybody in individualist cultures has all the
characteristics of this culture, and that everyone in collectivist cultures has the characteristics of those cultures
(p. 909). Therefore, the IC dimension can be used to
explain not only differences among cultures, but also
among individuals within a single culture (Triandis 1989,
1995). Individual-level measures of IC have been widely
used in business ethics research, and it has proven to be
useful in capturing the relationship between culture and a
number of behaviors at the individual level. For instance,
Wagner (1995) examined the influence of IC on the level
of cooperation in groups, whereas Gomez et al. (2000) used
it to predict in- and out-group team members evaluations.

Method
Participants and Procedure
The sample consisted of 202 Ecuadorian managers. The
demographic characteristics of the sample are summarized
in Table 1. In order to assess the presence of non-response
bias, the sample characteristics were compared to the
structure of employment of the economically active population. According to the Central Intelligence Agency, in
2005, 53.60 % of the economically active population in
Ecuador is dedicated to provide services while 18.80 and
6.5 % to industry and agriculture, respectively. The 2010
Ecuadorian Census (INEC 2010) reports that 11.2 % of the

Managerial Tolerance of Nepotism

49

Measures

Table 1 Participants demographic characteristics

Mean

SD

Frequency

Percentage

Age

35.34

5.30

Experience

9.39

3.21
120

59

82

41

High school

20

10

Some college

133

66

49

24

139
63

69
31

41

20

Gender
Men
Women
Education

College
Position in Organization
Middle management
Upper management
Industry
Community, social,
educational and personal
services
Commerce

38

19

Manufacturing

28

14

Finance and banking

25

12

Construction
Agriculture, foresting and
fishing

14
12

7
6

Transportation and
communication services

36

18

164

81

38

19

Other
Sector
Private
Public/government

economically active population works for the government

sector. That is, the sample presented here not only provides
a cross-section of a wide range of sectors in the economy,
but also mirrors closely the Ecuadorian labor force
breakdown.
To reach a significant number of local managers, an
online survey was employed. The use of online surveys,
especially with the ongoing advances in communication
technology, has gained popularity among researchers given
its associated time and cost efficiency. McDevitt and Small
(2002) argue that most online survey research results can
be extrapolated to the national populations or to the population of internet users. Online announcements of the
study were posted on various professional and social networking websites targeting human resources interest and
discussion groups in Ecuador. The announcement included
a brief description of the survey and a direct link to the
studys website. We conducted the initial recruitment from
May to June, 2012.

To measure the TPB components, standard questionnaire

items were formulated according to Fishbein and Ajzen
(2010) guidelines. First, the severity levels of the entire
scope of actions that managers might take to discipline an
employee who provided preferential treatment to a family
member during the hiring process were identified in
consultation with Ecuadorian HR executives; these
actions differed in their degree of severity: (1) reprimand
with an oral warning, (2) reprimand with a written
warning, (3) impose a fine, (4) suspend, and (5) lay off.
Each of these five actions were then used to create the
items for the attitude, subjective norm, and behavioral
intention scales. Before answering the question related to
the TPB, participants were informed that the questions
that followed were related to issues that managers like
them deal with when they find out that an employee has
favored a family member during the hiring process. The
English versions of the questions reported here were
developed using Brislins (1970) back translation
procedures.
Attitude
Respondents were asked to rate five statements on a 7-point
scale (1 = bad; 7 = good). The five statements were
developed by addressing each of the specific, intentional
behaviors identified above. A sample item is Reprimanding an employee who favored a family member when
hiring with an oral warning is The mean of the five
items was used to produce a composite score (higher scores
denote a more positive attitude toward disciplining an
employee who has favored a family member during the
hiring process). The scales Cronbach alpha reliability was
0.77.
Subjective Norm
The five items that composed the subjective norm scale
also reflected the different degrees of severity of personnel practices previously identified. The mean of the
five items, each rated on a 7-point scale ranging from 1
(strongly disagree) to 7 (strongly agree), was used to
compute a composite score (higher scores denote greater
perceived social pressure to discipline an employee who
has favored a family member during the hiring process).
A sample item is Most people I respect would reprimand
an employee who favored a family member when hiring
with an oral warning. The scales Cronbach alpha was
0.74.

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G. Wated, J. I. Sanchez

Behavioral Intention

Table 2 Factor loadings for exploratory factor analysis with Varimax rotation of attributions about nepotism scale

A measure of behavioral intention was estimated by calculating the mean of five items each anchored to a 7-point
scale ranging from 1(strongly disagree) to 7 (strongly
agree). The same five specific behaviors used to develop
the attitude and subjective norm scale were used to develop
the behavioral intention scale as well (e.g., I intend to
reprimand an employee who favored a family member
when hiring with an oral warning). The scales Cronbach
alpha was 0.82.

Scale

Individualism/Collectivism

1. Employees favor family members when

hiring because without connections it is hard to
get a job otherwise

Internal

External

0.16

0.59

2. Employees favor family members when

hiring because helping the family is the right
thing to do

-0.05

0.78

3. Employees favor family members when

hiring because it is a common practice in the
organization

0.17

0.60

4. Employees favor family members when

hiring because it is expected by society to do
favors for relatives

0.22

0.71

-0.02

0.58

The study adopted the 20-item measure developed by

Wagner (1995) to gauge collectivism. The items were
anchored on a 7-point scale ranging from 1 (strongly disagree) to 7 (strongly agree). A sample item is Winning is
everything. Higher scores denote a greater tendency to
emphasize group over individual values. In the present
study, the scales Cronbach alpha was estimated to be 0.73.

6. Employees favor family members when

hiring because they feel pressured by their own
families to do so

0.25

0.49

7. Employees favor family members when

hiring because they are dishonest

0.49

0.11

8. Employees favor family members when

hiring to boost their own egos

0.61

0.20

Attributions

9. Employees favor family members when

hiring because eventually they will find a way
to benefit from the decision themselves

0.85

0.04

10. Employees favor family members when

hiring because later they will ask the family
member to pay back the favor in some way

0.89

0.03

11. Employees favor family members when

hiring to gain more power and influence in the
organization

0.82

0.18

12. Employees favor a family member when

hiring because later they can together find a
way to beat the system and make money

0.75

0.07

13. Employees favor a family member when

hiring to gain status within their own families

0.72

0.28

An inductive method for item development was used in

order to identify both internal and external attributions that
may impact managerial intentions to tolerate nepotism in
organizations (Creswell and Clark 2007). This information
was then used to create scales measuring the extent to
which participants make external and internal attributions.
Seventy-one subject matter experts (SMEs) in the U.S.
(n = 34) and Ecuador (n = 37) were contacted through
online professional networks for the purpose of developing
the items associated with the attributions scale. Following
the methodology suggested by Schneider et al. (1992),
structured interviews were conducted with the SMEs to
identify the potential internal and external factors that may
influence individuals to favor family members in the hiring
process. They were first asked to describe an event that
they may have witnessed, experienced, or heard about in an
organization that involved an employee favoring a family
member during the hiring process. Then, they were asked
to list the potential factors that may have influenced this
person to favor a family member during the hiring process.
Brislins (1970) back translation procedures were used to
translate answers that were provided in Spanish.
Answers were carefully content analyzed to identify
terms and phrases linked to the internal and external factors
as described by Heider (1958), and then classified under the
respective heading. Based on these results, 11 statements
describing potential external and eight internal causes that
may influence people to engage in nepotism were identified. After the classification was finalized, three experts

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5. Employees favor a family member when

hiring because of the family members
hardship

Factor loadings [0.40 are in boldface

holding doctoral degrees in the area of Human Resources

Management were asked to independently (and blindly to
the authors classification) verify the categorization of the
antecedents of nepotism conducted by the authors.
Instances of disagreement were discussed until consensus
was reached on the final classification of the antecedents.
The information gathered from the structured interviews
was then utilized to develop scales assessing the extent to
which participants attribute nepotism to internal (a = 0.90)
and external (a = 0.80) causes. The items were anchored
on a 7-point scale ranging from 1 (strongly disagree) to 7
(strongly agree). A sample external item is Employees
favor family members when hiring because society expects
one to do favors for relatives. A sample internal item is

Managerial Tolerance of Nepotism

51

Table 3 Descriptive statistics and correlations

Variable

Mean

SD

1. Age

25.34

10.30

2. Experience

7.40

8.22

0.78**

3. Gendera

0.60

0.49

0.01

-0.02

4. Sector

10

0.22

0.42

0.08

0.13

-0.09

5. Intention

3.61

1.28

0.06

0.07

0.05

6. Attitude

3.39

1.39

0.26**

0.29**

0.00

7. Subjective norm

3.98

1.20

-0.03

-0.06

0.08

-0.11

0.55**

0.20**

8. Internal attributions

3.78

1.30

-0.08

-0.13

0.07

0.02

0.35**

0.03

9. External
attributions

4.39

0.96

-0.13

-0.18*

-0.01

-0.08

0.00

-0.07

0.10

10. Collectivism

4.30

0.68

0.11

0.15

-0.11

-0.07

-0.17*

-0.05

-0.16*

-0.02
0.22**

(0.82)
0.28**

(0.77)
(0.74)
0.45**

(0.90)
0.33**

(0.80)

-0.29**

-0.14*

(0.73)

N = 202. Cronbachs a reliability in parentheses

* p \ 0.05; ** p \ 0.01
a

Dummy-coded: 0 = men, 0 = private

Employees favor family members when hiring because

they are dishonest.

Results
Before proceeding to test the studys hypotheses, an
exploratory factor analysis was conducted on the 19 items
previously identified for the attributions scales. An
inspection of discontinuities in the scree plot of eigenvalues suggested that our initial assessment of twodimensions (external and internal attributions) was correct.
Consequently, two factors were rotated according to the
VARIMAX criterion. Factor loadings of at least 0.40 were
used to assign items to factors. Upon inspections of the
factor loadings, six items did not clearly load into a single
factor, and they were therefore eliminated. The rotated
solution with the 13 remaining items is presented in
Table 2. The internal factor accounted for 38.68 % of the
item variance, while the external factor accounted for
19.46 % of the item variance. The two-factor solution was
also supported by a parallel analysis (Lautenschlager
1989).
Table 3 presents means, standard deviations, correlations, as well as reliability coefficients for all scales. An
inspection of the correlation matrix reveals that all zeroorder correlations were in the expected direction with the
exceptions of the correlations between external attributions
and behavioral intention and those between external attributions and collectivism. The external attributions scale
was not related to intentions, but it was negatively related
to collectivism (r = -0.14, p \ 0.05).
Hypotheses 1 and 2 were tested using hierarchical
regression analysis. At step 1, attitudes and subjective

norm were entered in the equation. The linear combination

of these two measures was significantly related to behavioral intention, F(2, 200) = 50.25, p \ 0.001. As predicted
by hypotheses 1a and 1b, both attitudes (b = 0.17,
p \ 0.001) and subjective norms (b = 0.52, p \ 0.001)
had a positive impact on intention to discipline an
employee who favored a family member. Internal and
external attributions were entered in step 2. In support of
hypothesis 2, attributions predicted intention above and
beyond attitudes and subjective norms, F(4, 198) = 29.43,
p \ 0.001, DR2 = 0.02, p \ 0.05. Also as predicted,
internal attributions significantly predicted intention
(b = 0.16, p \ 0.05). Nevertheless, the effect of external
attributions was not significant.
In order to assess the multiple mediation models proposed in hypothesis 3, we followed Preacher and Hayes
(2008) suggested asymptotic and resampling method.
Unlike Baron and Kennys (1986) commonly used method
to test simple mediation models, this procedure allows for
the simultaneous testing of multiple indirect effects.
Preacher and Hayes suggest that investigating multiple
mediations involves testing for both (a) the total indirect
effect of the predictor on the criterion through all proposed
mediators, and (b) the indirect effect associated with each
proposed mediator. Furthermore, the authors stated that a
significant total indirect effect is not a prerequisite for
probing specific indirect effects.
Accordingly, the total indirect effect of collectivism on
intention through the three hypothesized mediators (attitudes, subjective norms, and external attributions) was first
assessed using the product-of-coefficients strategy. Results
suggested that the total indirect effect was significant
(Z = -2.11, p \ 0.05). We then proceeded to examine the
specific indirect effects through attitudes, subjective norms,

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G. Wated, J. I. Sanchez

Table 4 Mediation of the effect of collectivism on managerial intention to discipline employees who favored a family member during the hiring
process through attitudes, subjective norms, and external attributions
Point
Estimate

Product of
Coefficients

Bootstrapping
Percentile 95 % CI

BC 95 % CI

BCa 95 % CI

SE

Lower

Lower

Lower

Upper

Upper

Upper

Indirect effects
Attitude

-0.0160

0.0228

-0.6987

-0.0862

0.0279

-0.0920

0.0260

Subjective norm

-0.1590

0.0689

-2.3058

-0.3317

-0.0045

-0.3344

-0.0067

External attribution
Total

-0.0887

0.0271

-0.3349 -0.0068

0.0117

0.0166

0.7034

-0.0240

0.0531

-0.0138

0.0700

-0.013

0.0702

-0.1632

0.0774

-2.1079

-0.3702

0.0236

-0.3609

0.0311

-0.3591

0.0334

Contrasts
Attitude vs. subjective norm

0.1430

0.0689

2.0747

-0.0043

0.3074

0.0040

0.3194

0.0060

0.3221

Attitude vs. external attribution

-0.0276

0.0275

-1.0036

-0.1007

0.0289

-0.1031

0.0279

-0.1031

0.0279

Subjective norm vs. external

attribution

-0.1706

0.0717

-2.3794

-0.3400

-0.0183

-0.3436

-0.0236

-0.3452 -0.0248

N = 202. BC = bias corrected; BCa = bias corrected and accelerated. 5,000 bootstrap samples

and external attributions. Subjective norms significantly

mediated (Z = -2.31, p \ 0.05) the relationship between
collectivism and intentions to discipline an employee.
None of the other indirect effects were statistically
significant.
In order to confirm the results provided by the productof-coefficients strategy, we proceeded to inspect the results
from the bootstrap procedure recommended by Preacher
and Hayes (2008). The estimates and 95 % CIs (percentile,
bias corrected, and bias corrected and accelerated) are
reported in Table 4. The total and direct effects of collectivism on intention were b = -0.33, p \ 0.05 and b =
-0.16, n.s., respectively, thereby suggesting that the effect
of collectivism on intention decreases when controlling for
the mediators. Yet, the total indirect effect through the
three mediators failed to achieve significance. These results
appeared to run against the findings revealed by the product-of-coefficients strategy.
In accordance with the product-of-coefficients strategy,
however, subjective norm was found to be a significant
mediator of the relationship between collectivism and
intention in the specified direction. Subjective norm was
the only indirect effect that was significant. Furthermore, a
pairwise contrast of the indirect effects between subjective
norms and attitudes and subjective norms and external
attribution was conducted to determine if the effects of the
respective pairs indeed differed significantly from each
other. The results suggested that the indirect effect of both
pairs did differ significantly from each other. That is, the
specific indirect effect through subjective norms was
apparently significantly larger than the specific indirect
effects through attitudes and external attributions.
Given the substantial relationship between internal
attributions and collectivism (r = -0.29, p \ 0.001) and

123

that between internal attributions and intention (r = 0.35,

p \ 0.001), a second multiple indirect effects model was
tested post hoc that included internal attributions as a
mediator. First, the total indirect effect of collectivism on
intention through the four proposed mediators (attitudes,
subjective norms, external, and internal attributions) was
assessed by the product-of-coefficients strategy. Results
suggested that the total indirect effect was significant
(Z = -2.55, p \ 0.05). We then proceeded to examine the
specific indirect effects through attitudes, subjective norms,
external, and internal attributions. Of the proposed mediators, both subjective norm (Z = -2.26, p \ 0.05) and
internal attributions (Z = -1.92, p \ 0.05) appeared to be
mediators. None of the other indirect effects were statistically significant.
Next, we inspected the results from the bootstrap procedure recommended by Preacher and Hayes (2008). The
total indirect effect through the four mediators failed to
achieve significance. However, subjective norms and
internal attributions were both found to be significant
mediators of the relationship between collectivism and
intention (with point estimates of -0.14 and -0.07 and
95 % BCa1 bootstrap CI of -0.3169 to -0.0099 and
-0.1905 to -0.0099, respectively). Furthermore, a pairwise contrast of the indirect effects between subjective
norm and all other mediators and internal attributions was
conducted to see if the effects of the respective pairs indeed
differed significantly from each other. The pairwise comparisons between subjective norms and attitudes (point
estimate of 0.12 and 95 % BCa bootstrap CI of 0.0021 to
0.3161), subjective norm and external attributions (point
estimate of -0.16 and 95 % BCa bootstrap CI of -0.3460
1

BCa = bias corrected and accelerated.

Managerial Tolerance of Nepotism

53

Attitudes

Subjective
Norms

Collectivism

Intention to Tolerate
Nepotism

Internal
Attributions

Fig. 2 Model predicting managers tolerance toward nepotism as

supported by the data

to -0.0340), and internal and external attributions (point

estimate of 0.10 and a 95 % BCa bootstrap CI of 0.0168 to
0.2353) were significantly different from each other. In
short, the specific indirect effect through subjective norm
was significantly larger than the specific indirect effects
through attitudes and external attributions, whereas the
specific indirect effect through internal attributions was
significantly larger than the one through external
attributions.

Discussion
This study is the first to test a model that outlines how
cultural factors at the individual-level impact managers
decisions to discipline employees who favored nepotism in
the hiring process within the Latin American context. As
predicted by TPB (Ajzen 1991), attitudes and subjective
norms both played a significant role in the prediction of
managers intention to discipline employees who engaged
in nepotistic practices. Managers, who held a positive
attitude toward disciplining an employee who favored a
family member and who perceived that relevant people in
their lives thought that they should discipline an employee
who favored a family member during the hiring process,
were more likely to discipline nepotistic acts in organizations. Furthermore, adding internal attributions to the
notion of Ajzens (1991) perceived that behavioral control
constituted an incremental addition to the prediction of
intention. That is, managers who attributed employees
behavior to internal causes, e.g., employee dishonesty,
were more likely to discipline an employee than those who
made less of such internal attributions. On the other hand,
and contrary to expectations, the predicted negative relationship between external attributions and managers
intentions to discipline employees was not found. Moreover, we found partial support for the hypothesized impact
of culture on intentions through attitudes, subjective norms,
and external attributions. Subjective norms did mediate the

relationship between culture and intention, but the data

provided no support for the mediating role of attitudes and
external attributions.
To shed light into the role of internal attributions as a
possible mediator, a second model adding internal attributions as a mediator was tested in post hoc fashion. The
data supported the role of both subjective norms and
internal attributions as mediators between collectivism and
intentions. Specifically, managers collectivistic values
seem to engender weaker internal attributions and subjective norms, which in turn make them less likely to
discipline employees who favored a family member
(Fig. 2).
Theoretical Implications
The findings presented here underscore the relevance of the
TPB (Ajzen 1991) in the prediction of behavioral intentions to tolerate nepotism in organizational settings (e.g.,
Clayton and Griffith 2008). Furthermore, the re-conceptualization of the notion of perceived behavioral control into
internal and external attributions added value to our
understanding of intention to discipline a nepotistic
employee above and beyond the other TPB variables. In
other words, Ecuadorian managers attributions of nepotism significantly predicted their intentions to discipline
employees beyond their attitudes and subjective norms.
That is, the inclusion of two separate scales to gauge
external and internal attributions, respectively, might
indeed enrich the notion of perceived behavioral control
originally depicted in TPB (Ajzen 1991).
This study also provides further evidence regarding the
usefulness of conceiving IC at the individual level of
analysis. As predicted, higher levels of collectivism were
associated with lower levels of subjective norms and lower
levels of intention to discipline an employee who favored a
family member during the hiring process. Thus, the present
study adds to the evidence that IC varies within as well as
across cultures, and that such intra-cultural variation is a
meaningful antecedent of a variety of phenomena (e.g.,
Fischer et al. 2009; Gomez et al. 2000).
Even though value orientations have been consistently
linked to individual attitudes (e.g., Gomez and Sanchez
2005), and contrary to our expectations, collectivism was
not associated with attitudes toward disciplining an
employee who favored a family member during the hiring
process. That is, the notion of sacrificing personal goals
when they are in conflict with group goals may not be as
relevant to attitude formation as it is for subjective norms.
Alternatively, the formation of attitudes may be influenced
by factors that are more personally relevant in the case of
nepotism. Kin supportive behaviors are considered to be by
some evolutionary advantageous as they ensure access to

123

54

economic resources, social capital, and social networks

(Mhatre et al. 2012). As such, attitudes toward nepotism
may also be driven by evolutionary-like principles. Oskamp (1991) suggested that attitude formation may be
indeed influenced by genetic factors, which operate by
establishing a predisposition for the development of particular attitudes that have survival value. For instance, the
Big Five personality characteristics are considered from an
evolutionary perspective to be universally adaptive mechanisms that can lead to successful reproduction and preservation of life (Buss 1991). Future studies may then
consider the inclusion of variables such as personality
characteristics to test the role that evolutionary mechanisms may play in the formation of attitudes toward
nepotism.
In terms of the external attributions, the assertion that
collectivistic managers will be more prone to recognize the
external motives of nepotism than those who endorse
individualistic principles was also not supported by the
data. Collectivism seems to actually influence perceptions
of both internal and external causes of nepotism. Given the
high incidence of nepotism in Latin American countries
like Ecuador (Hayajenh et al. 1994; Punnett 2007), Ecuadorian managers may be very frequently exposed to acts
of nepotism. Therefore, one may argue that a schema for
nepotism is prominent in Ecuadorian managers. A schema
is defined as a cognitive structure that represents
knowledge about a concept or type of stimulus, including
its attributes and the relations among those attributes
(Fiske and Taylor 1991, p. 98). Schemas influence encoding of relevant information and people tend to remember
schema-relevant information (Hastie 1981). Furthermore, it
has been well documented that leaders attributions of
employees behavior are based on relevant past experiences (Bitter and Gardner 1995). Therefore, it is possible
that Ecuadorian managers already existing schema of
nepotism helps them recall both internal and external
motives.
Practical Implications
Our data suggested that Ecuadorian managers responses to
their subordinates nepotistic hiring decisions are deeply
rooted in peer norms, which in turn are driven by a cultural
drive to emphasize social interdependence. Such deeply
ingrained roots hint that managerial responses to nepotism
may be hard to change. Yet, to make hiring practices merit
based, we do not advocate a possibly ethnocentric change
of values. Instead, we suggest the implementation of culturally congruent HR practices that build upon existing
social capital. Social capital refers to a mechanism rooted
within ingroups that can be used by HR as a resource to
integrate and successfully coordinate activities within

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G. Wated, J. I. Sanchez

organizations (Gomez and Sanchez 2005). According to

Chua et al. (2012), close-netted groups share strong social
capital to the point that they share common values and
beliefs and are committed to a set of peer norms. We
suggest that the mechanism operating in Ecuadorian managers decision-making process is based on their shared
perception of strong social capital within the context of
cohesive ingroups.
As such, social capital can be used by HR to shape
organizational hiring and promotion practices that
emphasize fairness but at the same time acknowledge
kindness to family, i.e., a hybrid organizational structure
that would allow merit to co-vary with family membership
(Sidani and Thornberry 2013). The goal would be to create
mechanisms that protect the interest of employees who are
not related by family ties to the organization while
including advantages for those who are (Barnett and Kellermanns 2006). Such practices may include selection,
promotion, and succession planning policies that are based
on clear job descriptions which allow qualified family and
non-family members to assume the position at hand.
Within a well-defined organizational chain of command,
decisions will be made that maximize value for the organization. For instance, a qualified family member may be
preferred by a selection committee over an equally qualified non-family member when the family member is perceived as more trustworthy. Since the decision has meritbased elements embedded in the process, non-family
members may be more likely to still perceive such decision
as fair (Cabrera-Suarez 2005).
As stated earlier, responses to nepotism maybe rooted in
cultural values. However, despite the fact that dominant
cultural values are believed to be hard to change, there is
evidence suggesting that culture is perhaps dynamic (e.g.,
Minteer and Manning 2000). In fact, it has been pointed out
that group values can change across time and cultures as
the interaction among cultures and the exchange of ideas
evolves (Lull 2000; Ortiz 1947). Adaptation and convergence of cultural values are particularly relevant to globalized markets, which are characterized by a constant
exchange of information and ideas (Rogers 2006). Therefore, managerial awareness of changes in cultural norms
may facilitate the management of nepotism in multinational organizations.
Limitations and Concluding Remarks
First, this study used a cross-sectional design that obviously limited our ability to draw cause-and-effect inferences. For instance, whether the influence of IC on
subjective norms precedes its influence on intention cannot
be ultimately asserted in spite of the theoretical arguments
and empirical evidence presented supporting this

Managerial Tolerance of Nepotism

relationship (Ajzen 1991; Triandis 1995). Future longitudinal studies and, whenever possible, experimental or
quasi-experimental designs are warranted.
Although one may argue that method variance might
have overestimated the relationships among variables, the
interactions that emerged in our analyses cannot be easily
explained by common method variance, which is unlikely
to explain this type of nuanced relationships (Crampton
and Wagner 1994). Furthermore, the perceptual nature of
variables like attitudes and attributions lent itself to the use
of survey research as an appropriate means of gathering
data (Corbett 2001; Podsakoff and Organ 1986).
Future studies should include measures of nepotism that
explore alternative definitions of the phenomenon. For
instance, Muchinsky (2012) extended the concept of nepotism by differentiating between nepotistic and quasinepotistic organizations. According to Muchinsky, nepotistic organizations favor family members in selection
decisions, while quasi-nepotistic organizations extend their
favoritism to those who share group membership such as
having attended a certain school. Because both familism
and favoritism are relevant in the collectivistic cultural
context of not only Latin America but also Asia (Hayajenh
et al. 1994; Punnett 2007), further insight in the variation of
the familismfavoritism relationship across cultures should
help elucidate additional cultural nuances at play in the
phenomenon of nepotism.
Finally, the present study addressed nepotism from a
merit-based perspective suggesting that its practice is
counterproductive (Colquitt, Greenberg, and Zapata-Phelan
2005). However, not everyone shares this view of nepotism. It has been argued that some degree of preferential
treatment toward ingroup members may promote all
encompassing values of trust and solidarity, thereby fostering corporate cultural environments that are personal
and warm (Welch and Welch 2006). Future studies should
address this discrepancy by incorporating potentially
positive outcomes of nepotism.
In summary, the model presented here integrated several
streams of research to shed light into the role that cultural
factors play in managers tolerance of nepotism. To the
best of our knowledge, this is the first attempt to empirically study nepotism within a theoretical framework in a
Latin American country. Overall, our findings support and
expand the usefulness of TPB in this context (Ajzen 1991)
by enhancing the notion of perceived behavioral control
and including attributions in addition to attitudes and
subjective norms. Our findings also echo the importance of
cultural factors such as IC in managerial decision-making
and work-related behaviors (e.g., Taras et al. 2011). Furthermore, our data highlight not only the importance of
culture, but also the specific process through which culture
impacts managerial intention to discipline employees who

55

favored a family member in the hiring process (Ajzen

1991). The variables included in this process (e.g., subjective norms and internal attributions) should inform the
design of culturally sensitive and yet merit-based staffing
procedures that in turn facilitate business expansion into
markets.

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