Which statement best contrasts transformational ethics with transactional ethics?

• A. Transformational ethics emphasizes compliance with rules; transactional ethics emphasizes consequences.
• B. Transformational ethics emphasizes values-based change; transactional ethics emphasizes compliance with rules and consequences.
• C. Transformational ethics emphasizes values-based change; transactional ethics emphasizes consequences without reference to rules.
• D. They are identical.

Answer: (B)

Transformational ethics centers on guiding actions through values and moral purpose, aiming for values-based change in people and the ethical climate of an organization. In contrast, transactional ethics relies on rules, policies, and the consequences (rewards or punishments) that follow adherence or violation. The best contrast captures these distinct motivators and methods: transformational ethics fosters intrinsic motivation by aligning behavior with shared values, while transactional ethics emphasizes compliance with established rules and the outcomes tied to following or breaking them. The other statements mix up these emphases or omit the role of rules, so they don’t describe the two frameworks accurately.