I think that Business and Government effectively conspired to keep the business climate favorable. Requiring ethical behavior will stifle the excesses that make almost everyone happy--for a while. A PE or a similar employee willing to comment on the puffery in a proposal upsets the system and usually becomes a pariah. The modern example is that of Government conspiring to deregulate. The primary method was pushing credit inflation so that some business can be immensely profitable who then contriuted to politicians. The consequence is our present economic crisis, Was it worth it? I'll bet there are many well retired executives who would say yes and would be happy to do it all over again.
I predict that when we come out of this crises there will be a period of more ethical behavior. After a while, the same pressures will surfacer to cut ethical corners. I expect to be dead when the next pile of s*it hits the fan. But with progress in information technology and communication, there will be many bright and unscrupulous people willing to take advantage of our system's vulnerabilities.
Bill