The nature of ethics codes in franchise associations around the globe

Abstract

The worldwide growth of franchising has been phenomenal during the past decade. At the same time there has been increased media attention to questionable business practices in franchising. Similar to some trade associations and professions, franchising has sought self-regulation by developing codes of conduct or ethics. This study examines the codes of ethics covering franchising activities in 21 countries. The results reveal that there is considerable variation in the activities/issues covered by the codes. Specifically, the codes cover most stages of the franchising relationship, focus on a narrow set of stakeholders, are short on ethical guidance, and offer few enforcement provisions. The implications of these findings for international franchising and research are discussed.