The economic order in modern Russia still carries features of transitional model. One of these features is the process of formation of the ethical business norms and principles. Many of the aspects of modern Russian business culture could not be formed in the previous system, but they gradually evolved in the process of economic restructuring [Сайченко, 2013]. These aspects combine different models of behavior, including the opposite ones - some of them remained since the era of the authoritarian economy and some of them were borrowed from the modern business culture of Western countries. This situation is not conducive to stability and generates various ethical violations, which, in turn, further undermine the situation.

The media has covered many cases that create an impression that ethics and business concepts are not compatible in modern Russia. There are many examples that illustrate how businesses care only about profits and how they ignore ethical standards and even the law. These examples include concealment of income, avoidance of taxes and insurance payments, delay in wages, production and sale of unsafe or substandard goods, failure to comply with consumer rights or requirements for the protection of the environment and so on [Чеглакова, 2018].

Ethical problems in business sphere are most acutely manifested in the collision of two sides of the activity within one firm: the achievement of economic indicators (costs, income, profits) and the fulfillment of social obligations to its employees, partners and society.

For small businesses, following ethical codes is especially difficult because of their need to fight for survival. Besides, they are small is size, have limited finances and resources, they have trouble in building positive image and reputation and it makes them take shortcuts in their business practices [Medlin & Green, 2003].Small businesses are not only an essential component of a civilized market economy, an integral element of its inherent competitive mechanism, but also the most flexible, effective and transparent form of management due to its size. Any development of small enterprises affects overall economic growth and scientific and technological progress. In addition, with the help of small business, the market is saturated with goods of the required quality and there is an increase in jobs. This way of business mobilizes financial and production resources of the population. These facts constitute the relevance of the study.

The number of publications regarding how small businesses follow business ethics practice in Russia is not high. This situation is partly explained by the fact that in the domestic research environment there is a widespread opinion that due to the economically difficult situation of the majority of small businesses, the relevance of following the principles of business ethics is insignificant or absent [Савичева, 2010]. Another reason is the lack of established traditions in this area among young Russian enterprises, most of which are small and medium-sized businesses, due to the relatively short (just over 25 years) period of existence in the Russian market economy. Nevertheless, practice shows that small businesses are not alien to ethical behavior, and social responsibility often acts in the form of charity or care for the employees [Джинджолия, 2011; Ивашина, 2016]. Therefore, this study is aimed on filling this gap with the results of the research that will demonstrate the current challenges in following ethical business practices for small Russian businesses.

This aimis achievedby completing following tasks:

1. Analyze the main aspects of business ethics for small businesses;

2. Identify the significance of business ethics to small enterprises;

3. Analyze the ethical dilemmas and challenges of small enterprises faced by small businesses;

4. Analyze the features of business ethics of small enterprises in Russia;

5. To study the ethical business practices of small companies in Saint Petersburg;

6. Identify the main problems and prospects of small business development in Russia in context of business ethics;

7. Develop practical implications for the findings.

Research question: "How does gender, age, business experience of a small business owner or its CEO and the income level of the owned enterprise affect the ethical business practices of a small business in Saint Petersburg, Russia?"

The object of the research is small business in Russia.

The subject of the study are problems of small businessesin Russia in context of business ethics.

The empirical object of the study are owners of small businesses.

The research is a mix of quantitative (survey) and qualitative (interviews) methods of collection and analysis of information.

Hypotheses:

1. Gender of a small business owner or its CEOas a determinant significantly influences ethical business practices of a small business.

2. Age of a small business owner or its CEOas a determinant significantly influences ethical business practices of a small business.

3. Business experience of a small business owner or its CEOas a determinant significantly influences ethical business practices of a small business.

4. The income level of an enterpriseas a determinant significantly influences ethical business practices of a small business.

Thus, gender, age, business experience and income of an enterprise are independent variables. The dependent variables used in the quantitative part of the study are divided in two groups:

1. Unethical business practices:

· Providing benefits to someone in business or government to obtain an inappropriate market, workplace or economic advantage.

· Corruption and bribery.

· Fraud.

· Piracy and counterfeiting practices.

· Seeking unethical schemes to access low-quality goods at lower prices.

· Tax evasion.

· Padding expense accounts, seeking reimbursement for questionable or non-existent business expenses.

· Theft, misappropriation of commercial property or materials for personal use, abuse of company resources

· Soliciting or offering kickbacks.

· Price fixing.

· Coercion or intimidation, discrimination, harassment, cover-ups.

· Abusive behavior towards employees, lying to employees, employee benefit abuse, employee privacy violation.

· Lying to stakeholders.

2. Methods offighting unethical behavior:

· Training courses for small businesses.

· Stricter regulation by the state.

· Through industry associations of firms that will jointly take action to abandon unethical practices.

· Closer interaction between small businesses and regulatory authorities.

· Use of incentive systems for ethical behaviour Positive rewards for desirable behavior and negative rewards for undesirable behaviors.

· Use of ethical provisions and norms (e.g. implementation of a code of conduct).

· Involvement of an outside observer (for example, the involvement of inspectors who will monitor the ethics of decisions).

Basis of the study is theoretical (professional literature) and empirical (interviews and survey). The theoretical part of the work is based on the researches in the field business ethics concerning small businesses (Crotty, J., Donovan, A., Ferrell, O., Ma, J., McFarlane, D., Perrini F., Rune, A. and others).

The research is completely based on the primary data, which was gathered during the first qualitative part of the research (interviews) and then in thesecond quantitative part of the research(online survey). The collected set of primary data was analyzed with the help of Stata software to receive the secondary data.

Critical Constraints: The study faces someexternal validity challenges, sincethe findings are applicable mostly for the small businesses located in Russia, Saint Petersburg. It means that the results of this research may be not applicable for the similar studies in other countries and regions. In addition, it should be noted that the respondents' answers could be distorted due to the presence of the interviewer.

The target audience: the results of the study can be used in practical research activities in the field of small business. This research also may help those who are planning to start own business and want to learn about the current state of business ethics in Russia.

Literature review

Aspects of business ethics

According to Emerson [2009], ethics are moral values and principles of behavior. For Okafor [2011] ethics mean that right action is conducted at the right moment. There are numerous definitions for this term developed by a different writers and researchers. In general, ethics deal with moral duty and obligations towards society and its individual members. Rules of ethics are aimed on protecting them by guiding behavior of humans and preventing misdemeanor.

Business ethics studies how to conduct business from the morality point of view. Twomey and Jennings [2011] refer to business ethics as the application of ethics to entrepreneurship and business. The aim of such application is "balancing the goal of profits with values of individuals and society". In their studies Post, Lawrence, Weber [1999] and Hodgelts, Luthans [2003] also use such definition and state that ethical business is about applying general ethic rules to various business practices.

For small business owners it is important to view themselves as a part of community and society and be able to distinguish right from wrong, to avoid unethical demeanor and preserve ethical values. Besides, they also have to recognize their ethical responsibilities to meet the laws and needs of the community or society.

McFarlane [2013] provides the following classification of business ethics standards:

· The Law as Standard

Legal code provides clear instructions for ethical practices and it expects businesses to be law abiding. The government enacts and codifies rules that have to be followed by individuals and small businesses so they remains ethically compliant, because in this case being legally compliant equals to being ethically compliant [Twomey& Jennings, 2011].

Owners of small ventures should educate themselves and find out what laws influence their operation and business practices, since the law is a fundamental basis for conducting ethic business - it provides a common moral standard that has to be followed [Twomey& Jennings, 2011]. For instance, if a venture decides to manufacture and distribute unsafe products that may harm customers, it means that the producer acts against the law and conducts unethical business practices that should meet sanctions.

· UniversalStandards

Some ethical principles that guide human behavior emerge from human intelligence and they might be independent of legal code or even be contrary to it. Such principles serve are universal and do not seek support elsewhere but human conscience and logic that are able to clearly recognize what behavior is unethical and wrong. Twomey& Jennings [2011] define to these principals as natural law. For instance, people who see a business owner acting in unethical way (stealing from the customers, use of child labor, violation of sanitary norms and so on) recognize that such behavior as a wrong business practice, because they expect that business owners should be honest and ethical towards their customers, community and society. Besides, some universal standards take their origin in religious beliefs and have a huge impact on how ethics are guided in small ventures.

· The Standard of Situational & Moral Relativism

According to Twomey and Jennings [2011], numerous organizations today follow "situational ethics" that are defined as "a flexible standard of ethics that permits an examination of circumstances and motivation before attaching the label of right or wrong to conduct". Such moral relativism neglects absolute ethical rules and suggests analyzing and paying attention to the circumstances that occur and influence the decision-making process before deciding what is right or wrong from ethical point of view.

On the one hand, such flexibility can provide diversity and tolerance and let cultural relativism take place. On the other hand, such approach to validating what is good and what is bad may lead to blurred ethical standards, which will cause further ethical dilemmas. McFarlane [2013] suggest that moral relativism should be avoided by small enterprises, because it may make them vulnerable to legal and other sort of challenges.

· TheStakeholderStandards

Stakeholder standards are widely accepted and practiced by businesses due to their effectiveness in guiding ethical practices. Such standards provoke organizations to act socially and ethically, because of their need to meet stakeholders' expectations and desires. Twomey and Jennings [2011] assert that by balancing the interests of their stakeholders, businesses resolve raising ethical dilemmas. Stakeholders include customers, employees, shareholders, society, the government,suppliers and so on.

Rossouw [2004] states that when businesses identify and implement such standards of conduct they pay attention to whether they cause any harm to interests of their stakeholders, because when business is seen as ethical, it also becomes profitable. Besides, some researchers point out that it is a wise practice for businesses to invest in corporate social responsibility actions and behaviors, since in the long run those organizations that ignored such opportunities to do that will lose positive image and customer value in the result [Davis &Blomstrom, 1966].

Significance of business ethics to small enterprises

According to Weinstein [2012], today power in the market is in the hands of consumers and producers do not control it anymore. That is why stakeholders are becoming more and more important for businesses, that start to recognize that following ethical practices is a critical success factor [Twomey& Jennings 2011]. If businesses want to make profits, they have to be engaged in ethical commercial practices with dedication and faith. Such approach will also help them to avoid issues with the law, customers, suppliers, employees and so on. If ethics are not followed, business reputation may suffer, customers will lose trust and start to seek for alternatives, the business may face lawsuit and other negative issues, which may be critical for small ventures, may arise [Donovan, 2013]. Hence, businesses have to pay attention to ethical values and be cautious to balance the race for profits with the community's values if they want to survive. [Twomey& Jennings, 2011]

Ahmad [2009] asserts that in the long run it is very important for small enterprises to maintain honesty and integrity, to follow ethical business practices, take responsibility and be aware of the consequences of each action. If conducted properly, such approach will help an small business to distinguish itself from its competitors and gain competitive advantage. Hasnah, Ishak&Sobei [2015] agree that enterprises that are committed to enhancing integrity by following their ethical codesare more likely to succeed in a commercially competitive world. Goll and Rasheed [2004] state that in unpredictable environments that change at very high speed, ethical behavior and social responsibility gives businesses an opportunity to get support from various external stakeholders, which provides them with some protection from unpredictability.

According to McMurrian&Matulich [2006], the main obstacles that occurs when businesses consider adopting ethics programs are the money expenditure and belief that ethical practices are rewarding only for the society. However, in fact, Ferrell [2004] found that enterprises that are viewed as ethical and honest actually enjoy such competitive advantages as higher commitment and loyalty from their employees and higher customer loyalty and retention. They also experience higher levels of efficiency in operations and better financial performance. This leads to a conclusion that high ethical standards may contribute to small businesses' profitability by reducing transactional costs and building trusting relationships with significant stakeholders[McMurrian&Matulich 2006].

Ethical dilemmas and challenges of small enterprises

According to Wiid, Cant and Van Niekerk [2013], nowadays it can be witnessed that many businesses of all sizes conduct unethical behavior that creates certain risks for business organizations and their stakeholders. Small business find themselves in an especially vulnerable position with regard to such unethical business practices as corruption, fraud and so on. According to Medlin and Green [2003], they experience more difficulties since they struggle to survive, their size is small, they have limited finances and sources of funding, they are highly dependent on sometimes overpowering customers and word-of-mouth marketing strategies, they experience difficulties in building positive image and reputation and they tend to take shortcuts in their business practices.

According to Tarus and Nganga [2013], such factors as scale economies, lack of information, credit, quality and reputation make small businesses weak in comparison to other market players and uncompetitive. Besides, owners of small businesses know about unethical practices that occur in large companies and governments and they see them as acceptable - such approach affects their own behavior and perceptions, which opens them to misconduct and dishonesty. [Wiid et al. 2013] Small enterprises recognize such practices to be essential for them to survive, since they are limited in resources and capabilities and that makes it hard for them to avoid corruption and fraud. According to Rune [2011], such view led to acceptance of corruption and fraud as normal practice, especially in the developing countries, because they provide small businesses with ways of getting something done faster even if it is illegal and unethical.

Schermerhorn, Hunt, Osborn and Uhl-Bien [2010] distinguish three ways of dealing with business ethics within small companies: the way of moral manager, an amoral manager, or an immoral manager or owner in making decisions. Moral managers are ethical managers, who believe they are doing the right thing. When they make decisions, establish practices and policies for their businesses they understand the importance of avoiding misconduct as expected by their stakeholders - ethical considerations are important for them. Amoral managers take their business sense and financial consequences into perspective when they make decisions. This is a business-centered approach that doesn't take ethics into considerations, because for them they have nothing to do with business. The last way of dealing with business is the way of immoral manager, which is the hardest challenge for small enterprises. Immoral manager understands the value and significance of business ethics and distinguishes ethical and unethical business practices, but he cares about raising profits so much that ignores the negative ethical repercussions and chooses to act and behave in unethical way.

Here is a summary of the most common ethical dilemmas faced by small businesses:

· Providing benefits to someone in business or government to obtain an inappropriate market, workplace or economic advantage. [Abiodun&Oyeniyi, 2014]

· Corruption and bribery. [Rune 2011]

· Fraud. [Rune, 2011]

· Piracy and counterfeiting practices. [Rune, 2011]

· Seeking unethical schemes to access low-quality goods at lower prices. [Mahmood, 2008; Tarus&Nganga, 2013]

· Tax evasion. [Mahmood, 2008; Tarus&Nganga, 2013]

· Padding expense accounts, seeking reimbursement for questionable or non-existent business expenses. [Ononogbo et al., 2016]

· Theft, misappropriation of commercial property or materials for personal use, abuse of company resources. [Ononogbo et al., 2016]

· Soliciting or offering kickbacks. [Ononogbo et al., 2016]

· Price fixing. [Ononogbo et al., 2016]

· Coercion or intimidation, discrimination, harassment, cover-ups. [Ononogbo et al., 2016]

· Abusive behavior towards employees, lying to employees, employee benefit abuse, employee privacy violation. [Collins, 2012]

· Lying to stakeholders. [Collins, 2012]

Features of business ethics of small enterprises in Russia

In Russia, entrepreneurial ethics began to develop at the end of the 20th century. Back then, Russian companies were often perceived in Western countries as unreliable partners, using unfair methods of competition and mired in corruption. One Russian scholar [Блинов, 2003] points out that the reasons for such low levels of business ethics in the 1990s were a number of factors that affected both the ethics of entrepreneurship and entrepreneurship itself. The first factor is the complete lack of intention of the first Russian entrepreneurs to serve people. Secondly, Russian entrepreneurs had a common complex of "inferiority", humility, fear of going "to the end", risking big, psychology of a loser, not reliance on own forces, which led to the reluctance to seek for compromises. Thirdly, it was low standard of living of the Russian population in the 1990's and the uncertainty that accompanied it. The fourth factor was the desire to limit competition, use of personal ties and monopolism. Among other reasons, it was the lack of image of a business person - it was represented in the style of thinking, the manner to dress, in overall behavior and communication with others. It is also should be pointed out that various people tried to start businesses in the 1990's and not all of them were decent citizens - the whole criminal situation of those years had a negative impact on business practices [Матолыгина, 2012].

According to Savicheva [2010], nowadays the most important features of the Russian environment of SMEs include shady nature of business, failure to comply with the existing legislation, the lack of managerial approaches to socially responsible behavior, a narrow range of stakeholders, poor working conditions and vulnerability to local authorities.

Crotty [2016] in his study of Russian companies identifies five types of social responsibility of Russian businesses:

1. Market-driven (based on commercial benefits). It is the most common type for Western companies.

2. Social responsibility that is a part of "the USSR heritage ", or philanthropic (paternalistic).

3. Social responsibility that represents the "heritage of the transition period" (the period of the 1990s, when the payment of wages was already considered a responsible behavior).

4. Forced (arising under pressure from the authorities);

5. Social responsibility with difficult to define features.

Perrini [2006] points out different approaches of social responsibility that is used by large businesses and SMEs in Russia: large businesses use the stakeholder approach, and SMEs stick to the theory of social capital. Ma, [2012] identifies following differences in motivation to implicate social responsibility policies for large and small businesses: small businesses have a connection are motivated by altruism and positive attitude to philanthropy, while large businesses are motivated by corporate strategy and development of intangible assets. The scholar also emphasizes the difference in the scale of responsibility for companies of different size: for small businesses the scale is individual (based on the importance of the individual and the role of individual managers in the decision-making process); for large businesses the scale is corporate (based on positions as agents of corporate policy). Big businesses largely formalize the CSR strategy, while the small use the informal procedures.

In another study [Ивашина, 2016] the author sees the social responsibility of small and medium-sized businesses as a motive for building effective communications and expanding the tools of interaction with stakeholders. Employees stand out as an important group of stakeholders. The process of interaction with stakeholders is less formal than that of large companies, which is associated with paternalistic management. At the same time, volunteering is a feature of social responsibility of SMEs. In general, the obstacles in development arise due to limited resources, lack of media support, small number of partners and stimulation of socially responsible and ethical behavior. The author also concludes that the external environment does not actually motivate Russian business to take greater responsibility.

Another article [Джинджолия, 2011] identifies three levels of social responsibility of SMEs:

1. Basic (stable and decent wages, payment of taxes, job creation);

2. Corporate responsibility (providing employees with decent working conditions, additional health insurance, training programs);

3. Higher (charity).

In the context of growing social activity of small business in Russia, the author calls financial instability an obstacle to following the principles of social responsibility of business.

In another study [Чеглакова, 2018] several assumptions were made and investigated concerning the state of business ethics in Russia. The first assumption that Russian small business owners do not have a holistic view of the social responsibility of business, but only a fragmentary one, was confirmed. It was found that Russian entrepreneurs give various definitions to "social responsibility of business" and "business ethics". The two most common perspectives in understanding business ethics are: 1) business ethics stands for responsibility to stakeholders; 2) business ethics is a system of moral norms that regulates business relations in the market. The terms "corporate social responsibility", "social responsibility of business" remain the language of professionals, but are not used by entrepreneurs in SME segment.

The second assumption that owners and managers of Russian SMEs are motivated to socially responsible behavior was rather confirmed. The researchers identified three main groups of motives: 1) concern for stakeholders; 2) the need to comply with the requirements of the state; 3) search for competitive advantages. Russian entrepreneurs are interested in behaving ethically, expecting the improvement of the company's relations with customers and in the future growth of the company's profits as a result of the positive attitude of external and internal stakeholders to it.

The assumption that owners and managers of small businesses in Russia identify ethical conflicts and regulate them was partially confirmed. In conflict issues related to labor relations, personnel relations with customers and corporate culture, managers adhere to adaptive and preventive strategies of socially responsible behavior. Nevertheless, in conflicts with controlling organizations such as representatives of the state, their strategy of responsibility is defensive.

The assumption that the socially responsible behavior of small businesses has such characteristics as focus on employees and customers, the use of mostly informal procedures for the implementation of social responsibility, the initiation of social projects mainly by the owner, was confirmed. Many voluntary actions by small businesses are hardly ever systematic, despite their regular nature and duration. They are not structured into formalized strategic processes and are probably poorly visible to stakeholders outside the company.

In a number of works [Джинджолия, 2011; Ивашина, 2016] it is concluded that small and medium-sized businesses are gradually becoming socially responsible. There is also another opinion, according to which, Russian small and medium-sized businesses find themselves in unpleasant situation, which makes it difficult to pay attention to social responsibility and ethics.

Civilized ethics of entrepreneurship in Russia is in the process of active formation, but this process is complex takes much time, because not only entrepreneurs take part in it. As the practice of other countries shows, for the formation of civilized business ethics a strong executive power is necessary. It should be manifested in political and economic freedom and stability, stability of legislation. It is also necessary to popularize with the help of the media the image of a businessperson, not just as a successful, but a highly moral individual. The inadmissibility of unfair competition, corruption and fraud, a viable right, i.e. the fight against violations of the law in domestic business, the adoption of laws that clearly regulate domestic entrepreneurship, are mandatory. In addition, of course, there is a real opportunity to create professional associations of entrepreneurs. These associations should clearly monitor the level of morality of their members and apply the most severe sanctions in case of violation of group morality. To conclude, the unacceptability of corruption should be viewed as the main core of business ethics. [Матолыгина, 2012]

Even though there have been conducted several researches that explored business ethics in context of Russian small business, there is still a number of questions that has to beexplored. This study covers some of them. Firstly, in this research, the current (and most common) ethical dilemmas faced by Russian small businesses areexamined and discussed. Secondly, this study also demonstrates the opinion of Russian small businesses regarding how harmful unethical practices are and how important it is to give them up. Lastly, this study also provides the vision of the Russiansmall business representatives regarding how the unethical business behavior can be fought, what effective methods could be used.

Methodology

The stages of theempirical part of the research are following:

1. To create a trial version of the semi-structured interview guideline.

2. To test the trial version of the semi-structured interview guideline on a trial sample of appropriate respondents (small business owners or managers).

3. To improve and correct the mistakes made the trial version of the semi-structured interview guideline.

4. Repeat steps 2 and 3 if needed.

5. To conduct a set of semi-structured interviews, according to the guideline.

6. Analysis of the received results.

7. Create a list of relevant questions for the online survey basing on the semi-structured interview analysis.

8. To test the surveyon a trial sample.

9. To improve and correct the mistakes made in the survey.

10. Repeat steps 8 and 9 if needed.

11. To conduct the survey and collect the primary data.

12. To analyze the received results with the help of Stata softwareand get the secondary data.

13. To present the main features of ethical business practices of small companies in Saint Petersburg.

For the studyentrepreneurs, owners, CEOs and managersof small businesses located in Saint Petersburg, Russia were chosen. The research is split in two parts: the qualitative part represented by the semi-structured interviewing and quantitative part represented by the online survey.

In qualitativepart 10 businessmen were interviewed. The interview guideline is represented in Appendix 1. The final findings of the semi-structured interviewsare discussed in the chapter devoted to the results. . The number of interviews is justified by thesaturation point that revealed several curious trends.

In quantitativepart68answers were gathered. The survey guidelineguidelineis represented in Appendix 2. General sample equals to 293000, confidential level is 90%, the acceptable margin of error is 10% and the minimum sample size is 68. Fordatacollectionanonlinesurveywasused.

The hypotheses of the research are:

1. Gender of a small business owner or its CEO as a determinant significantly influences ethical business practices of a small business.

2. Age of a small business owner or its CEO as a determinant significantly influences ethical business practices of a small business.

3. Business experience of a small business owner or its CEO as a determinant significantly influences ethical business practices of a small business.

4. The income level of an enterprise as a determinant significantly influences ethical business practices of a small business.

The further analysis was performed with Stata software. Multiple linear regression analysis was conducted to gather secondary data.

Results

During thequantitative part of the research, the responses from 10 respondents were gathered and analyzed. The semi-structured interview guidelinecan be found in Appendix 1.

Regarding the first question of the interview, it was found that the participants of the study have vague ideas about the ethics of business and social responsibility. Nikolay, a small business owner, expressed the following opinion: "Business ethics are usually considered by large companies, and my business is small and I do not develop my business in that direction". In his interview, Nikolay defined business ethics as "mandatory rules of conduct, certain customs, which are not required, but are recommended to follow for businessmen, corporate employees and other business people". Such definition was supported by two more respondent out of total ten. The most common definition of business ethics given by the interviewees is:"A set of secret or public rules that provide guidelines for conducting activities, communicating with customers, employees, subordinates and the authorities". This view was expressed by four out of ten respondents. Two respondents claimed that business ethics is about relations within the company, the company's corporate culture. The last respondent referred to business ethics as moral norms that include honesty, decency, and respect.

Discussing the second question of the semi-structured interview guideline, the most common ethical dilemma faced by the most of the respondents concerns the relations between the authorities/government and the small businesses. Half of respondents claimed that they have experienced issues while dealing with governmental representatives. According to Oleg, who is a general director of a company involved in construction, corruption and bribery are commonly practiced by almost every small enterprise in one way or another: "Our state does not care how firms interact with each other, but with regard to interaction with the state apparatus, state bodies call for some worship in their favor. Sometimes it is their demand or it is something that you figure out by yourself that in order to achieve progress in your business, you need to provide the authorities with certain benefits." The second dilemma that was found to be crucial by three out of ten interviewees is taxation avoidance, which is represented by giving compensation to employees right in their hands. For two respondents, who own small retail enterprises, the most common dilemma is the need to search for unethical schemes in order to access low-quality goods at low prices. In addition, some respondents mentioned theft of commercial property for personal use, coercion or bullying, price fixing, piracy and the need to provide benefits to third parties to enter the wanted market.

The third question is aimed at identifying possible motives of social responsibility and ethical behavior of small businesses. Six interviewees told that their main motivation to follow business practices lies in the concern for stakeholders, among which the customers were considered to be the most important. During his interview, Igor, the owner of a small retail business told that without polite treatment, care about the quality of goods and services and satisfaction of complaints it is not possible to survive. The another group of stakeholders that is also considered to be important by the respondents are employees. Here are the words of Denis, who is an owner of a small marketing agency: "We have certain rules that regulate the relation within the company, but we do not follow it accurately. Rather, we try to understand what is reasonable, what is unreasonable, and treat each other more like good friends who can give good advice". The other four respondents mentioned that their motivation to follow business ethics is related to the need to comply with the requirements of the state. Indicators of such responsible behavior include: taxes and benefits payment; environmental investments and fulfillment of warranty obligations. "The state as the main institution for regulating order requires companies to play fair in the market. Avoiding state's requirements is a criminal offence in our country". However, according to Oleg, it is difficult to "stay clean and follow ethical business practices in regard to the authorities" and "sometimes you have to play dirty to survive".

The interview showed that 8 out of 10 entrepreneurs consider themselves to be well-informed about the sanctions that are applied by the regulatory authorities for violation of the norms of the business environment within the framework of the criminal and administrative code, the tax code and antitrust legislation. From the words of Dmitry, who is the head director of chain of small coffee shops in Saint Petersburg: "The creation and conduct of illegal business (drug trafficking, racketeering, extortion, etc.) is punishable in our country. Also, the state pays a huge role to antitrust policy, thus creating conditions for healthy and full competition between players in the market". However, three respondents indicated that they follow the ethical rules intuitively and that they do possess accurate information. Andrey, who is an owner of a sports goods store, said: "Common sense is enough not to face sanctions. The main and the most important practice is not to attract the attention of regulatory authorities."

The answers to the question about the person who is responsible for evaluating whether the decision ethical or not demonstrate that in seven cases firms do not have specialists in ethics control. Some respondents pointed to the special role of the owner of the company in shaping the ethical image of the company. Here are the words of Alexey, who is in charge of a chain of barbershops: "The head becomes the moral leader of the company, sets the overall climate of the company and determines the degree of ethics and responsibility of actions." The other three respondents found this question difficult to answer.

Four respondents told that they do not practice socially responsible behavior or implement any social projects. Managers explain the refusal of voluntary social projects primarily by the need for businesses to focus on operating activities. They also mentioned that this is more applicable to large companies. The majority of respondents (6 out of 10) confirmed the existence of social activity practices and social programs that are not systematic. According to the answers, it depends on the firm's specialization. In addition, three respondents consider additional payments and privileges, besides established by the state as socially responsible activity. Here are the words of Denis: "In the company we invest in our employees. We pay for their professional development, buy gym them passes. We pay salaries and bonuses on time. We give the required leave. These are the most common practices we use here."

Regarding the ways to fight unethical behavior, respondents expressed a variety of opinions. The most of the respondents (5 out of 10) see the exit in a more accurate and closer cooperation between business and government. Denis, who shares this view, said the following: "If the government reduces its role in the economy by reforming the regulatory policy on the basis of effective market mechanisms and improves the administrative system, small businesses will find it easier to function. In the result it will result in the prosperity of Russian economy on the whole different level." Three respondents claimed that in order to abandon unethical business practices small businesses need to start forming industry associations. Two respondents stated that it is better to accept how it is. Here are the words of Nikolay who shared this opinion: "In Russia it is very difficult, and sometimes impossible to conduct business without giving up moral principles. The existing system offers the best possible shortcuts, thanks to which you can start and develop your own business, even though sometimes you have to close your eyes and pretend that you see no chaos around you."

Turning to the perspectives of development of business ethics in Russia, the eight of ten respondents agree that by sticking to ethical practices the following benefits can be achieved: improved reputation, effective team building, staff involvement, easier customer attraction and retention, improved relation with the authorities and society and so on. Dmitry expressed the following opinion: "It is important to take care of partners, customers, employees, your own reputation - everyone understands this. And it's not just about helping each other benefit, it's about the fact that we treat each other like human beings. If we gave the word to someone, then we will not play dark games with him. More and more businessmen understand this." However, there is also a completely different opinion shared by other respondents. Andrey told in his interview: "I do not really think that business ethics is an issue for me. I have never deceived anyone, I have paid all required taxes and salaries properly, so I do not really believe that there is any need to talk about the "perspectives". Business owners should care about their enterprises - this is my business practice number one."

Summing up the results of the interview, several conclusions can be made:

1. Business people give various interpretations to the term "business ethics". Most of the interviewees understand it as a set of rules that provides guidelines for conducting business activities, communicating with customers, employees, subordinates and the authorities.

2. The most common dilemma faced by theentrepreneurs, small business owners and managers concerns the relations with the authorities/government.

3. The main two motives for ethical business behavior, according to respondents, are concern for stakeholders and the need to comply with the requirements of the state.

4. Entrepreneurs, small business owners and managers arewell-informed about the sanctions that are applied by the regulatory authorities for violation of the norms of the business environment within the framework of the criminal and administrative code, the tax code and antitrust legislation.

5. Small businesses do not have specialists in ethics control - in most cases, whether the decision is ethical or notis evaluated by the decision maker himself.

6. The majority of respondents confirmedthat they conductsocially-oriented activities and social programs that are not systematic.

7. The most of the respondents believe that unethical business behavior can be stopped of small business and the government start to cooperate more closely.

8. Most of the interviewed entrepreneurs, small business owners and managers see reason in following ethical business practices because of the benefits they provide. They believe that more and more business people start recognizing the value of ethical behavior.

During the quantitative part of the research, the responses from 68 respondents were gathered and analyzed. The questions of the used onlinesurveycan be found in Appendix 2.

The first multiple regression built was for the question that asked respondents to rate from 1 to 5 how often they have dealt with theethical dilemmas listed in the survey. The multiple regression analysis results can be found in Appendix 3.

Here is a summary of the results:

1. Corruption and bribery arefairly frequent dilemmas for male respondents and highly frequent for respondents with higher income.

2. Fraud is moderately frequent dilemma for male respondents.

3. Piracy and counterfeiting practices are highly frequent dilemmas for male respondents and respondents with higher income, and they arefairly frequent for respondents with less business experience.

4. Seeking unethical schemes to access low-quality goods at lower prices is a moderately frequent dilemma for male respondents.

5. Tax evasion is a moderately frequent dilemmafor male respondents and fairly frequent for respondents with higher income.

6. Soliciting or offering kickbacks isa highly frequent dilemma for older respondents, and moderately frequent for male respondents and respondents with higher income.

7. Lying to stakeholdersisa highly frequent dilemma for respondents with higher income, moderately frequent for male respondents and fairly frequent for respondents with less business experience.

The second multiple regression built was for the question that asked respondents to rate from 1 to 5 theharmfulness ofthe unethical practices (and how important it is to give them up)listed in the survey. The multiple regression analysis results can be found in Appendix 4.

Here is a summary of the results:

1. Providing benefits to someone in business or government to obtain an inappropriate market, workplace or economic advantage is found to be highly harmful by female respondents, moderately harmful by older respondents and fairly harmful by respondentswith lower income.

2. Fraud is found to be moderately harmful by respondents with greater business experience and fairly harmful by younger respondents.

3. Piracy and counterfeiting practicesare found to bemoderately harmful byrespondents with greater business experience.

4. Seeking unethical schemes to access low-quality goods at lower pricesis found to bemoderately harmfulby femalerespondents.

5. Tax evasion is found to be highly harmful by female respondents.

6. Padding expense accounts, seeking reimbursement for questionable or non-existent business expenses are found to be highly harmful by female respondents.

7. Theft, misappropriation of commercial property or materials for personal use, abuse of company resourcesare found to be moderately harmful by female respondents.

8. Soliciting or offering kickbacks is found to be moderately harmful by younger respondents.

9. Price fixing is found to befairly harmful by respondents with higher income.

10. Coercion or intimidation, discrimination, harassment, cover-upsare found to be highly harmful by female respondents.

11. Abusive behavior towards employees, lying to employees, employee benefit abuse, employee privacy violationare found to be moderately harmful by female respondents.

12. Lying to stakeholdersis found to be highly harmful by female respondents.

The third multiple regression built was for the question that asked respondents to rate from 1 to 5 the effectiveness of methods listed in the survey that may be used to fight unethical behavior. The multiple regression analysis results can be found in Appendix 5.

Here is a summary of the results:

1. Training courses for small businesses is found to be a highly effective method by female respondents.

2. Stricter regulation by the stateis found to be a highly effective method by female respondents, older respondents and respondents with greater business experience.