Drawing on the theoretical insights from the resource‐based view of the firm, this paper explores how human resource (HR) systems may contribute to competitive advantage by facilitating the development and maintenance of five types of ethical climates, and conversely, how HR systems may hinder competitive advantage by inhibiting the development and maintenance of these climate types. In so doing, this paper contributes to the literature by highlighting the resource worthiness of a firm's ethical climates and showing how HR systems may influence that value. In addition, it advances theory that underpins the concept of competitive advantage sustainability and provides a platform for future empirical research.
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