In this article the attention is focused on the problem areas of nepotism research, with emphasis on the private sector, aiming to encourage scientific discussion that would draw the guidelines for further studies. Nepotism in both the private and the public sector is identified as a social network or networks, where private interests arise in relations with other concerned members and it conflicts with the organization/public interests. The formation of such networks threatens by the fact that both social and material capital may be created while some groups are discriminated by other groups. While a normative problem of a social network and a conflict of interest arising in it is highlighted as more relevant to the private sector, the issues of ethical evaluation are particularly relevant to both the private and the public sector. Prevention of nepotism in the business sector is treated as avoidance of the conflict between individual and organizational interests and creating barriers for their occurrence at the individual and organizational levels. However, inconsistency of nepotism discourse in the private sector makes the development of effective prevention measures difficult in practice, therefore, purification of evaluations of the phenomenon, the development of national business ethics and creation of the regulatory framework, providing more tools to managers of business organizations should become the main guidelines for the research. In this case, the experience of the public sector in regulation of labour relations can be valuable, identifying the contents of the conflict of interest and resolution measures, despite the possible objections of liberal policy supporters on vertical initiatives of the state. [...]

Nepotism is presented quite selectively in studies, distinguishing socio-cultural aspects and positive and negative consequences for the development of viability of organizations. However, there is a lack of analysis of the phenomenon on the level of the development of management culture of the organization as an artificial system, in which natural social factor of nepotism would be implicated. This can be regarded as a drawback of the research and, together, the point of reference for further research. Positiveness of nepotism for business opportunities becomes apparent in employee search process, but in other processes of existence of organizations such benefits remain unproven if the organization uses wage-work, not family members’ work. In organizations that use wage-work, nepotism can be justified and is effective only on the stage of searching for employees. In other processes of organizational existence and management nepotism should be seen as a subjective and dysfunctional factor. Therefore, when modelling the effects of nepotic relations, formation of the module of the management culture, encompassing knowledge and creativity of management, the beginning condition of which is the results of theoretical studies and empirical research, becomes an exceptional factor in practice. When evaluating the intensity and quality of the internal communications in the practice of organizational activities, professionals’ opinion from the outside is relevant. The model can be used both in theoretical studies of the phenomenon, and in the management in organizational practice when hiring employees and evaluating the impact of clustering on organization’s processes.

The results of the empirical research of the influence of nepotism on organisational culture are presented in the article. The questionnaire is composed of two parts: the phenomenon of nepotism and the sick culture of the organisation. This article presents the first part of the results of the research evaluating the expression of nepotism in relations with co-workers, the expression of nepotism in respect of managers and the aspects of positivity and negativity of nepotism. The results of this research are useful for both the public and private sector organisations, as they reflect the general approach of people working in Lithuanian organisations towards the phenomenon of nepotism.

Of Lithuanian and foreign scientists articles analysis, is determined that the phenomenon of nepotism is presented as protection of relatives, i.e., investment in human capital – family, relationship by marriage, not to productivity. This way does not guarantee the quality of human resources and damage workers’ interpersonal relationships, disturbing both the public and private sector organizations’ work. In a broad sense, nepotism is dysfunction of social relationship, in assessing aspects of all socium. Although nepotism is often associated with the legacy of the socialist system in Lithuania – it is a broader social phenomenon, beyond the political systems of frames, well grounded of the human nature and the cultural context. Society development is related with the negative aspects of the phenomenon harm to the public and private sector systems and understanding of the phenomenon as unacceptable, the institutionalization of the national acquis. Analysis of nepotism, favoritism and protectionism specificity showed that these phenomena are described quite differently, the common denominator is becoming protection, exceptionally creating favorable conditions for a social network of representatives: the family members, relatives, friends, financial partners. Social networks can be formal (family) and informal (similar geographic origin, ethnicity, military service, friendship, etc.). Informal network boundaries are difficult to define, and one person can belong to multiple networks, so networks can overlap and form metanetwork. Of the general denominators of nepotism, favoritism and protectionism, it is proved that these phenomena are closely related, and they can not be completely separated. Analyzed phenomena have the same core – corruption and discrimination, but differs protection objects and forms of corruption. [...]

It is emphasized that nepotism in the culture of business organizations is not less widespread than in public sector. In business organizations there is no steady opinion on whether nepotism is a purely negative phenomenon when forming organization’s staff, efforts to find pragmatic, beneficial aspects for business organizations are made. Attention is paid to ethical evaluation dichotomy. Subject of the research: nepotism evaluation dichotomy. Aim of the research: to analyze nepotism evaluation dichotomy from social and ethical aspects. Lithuania focuses on the problems of nepotism in the public sector to examine the intensity of the phenomenon often in conjunction with a historical-systematic heritage. Less attention has ethical and economic aspects of the phenomenon in the private sector. Nepotism comes from social relations that have naturally formed in different groups, group collective selfdefense mechanism that encourages defending and protecting the interests of its representatives. Tribal, family, local criteria in modern societies are supplemented by many other criteria that are based on indirect monetary benefit exchange that allow forming a rather closed clan. When evaluating in the public context, nepotism ethically can be considered as a certain social dysfunction, discrimination. Nepotism is characteristic to many socio-cultures, although it manifests itself differently depending on the traditions and civil, moral maturity of the society. For this reason ethical dichotomy of nepotism evaluation is selective. Social nature of the phenomenon influences ethical evaluation, positive treatment of the phenomenon in business sector promotes social tolerance to nepotism in the public sector. [...]