Why Financial Executives Do Bad Things: The Effects of the Slippery Slope and Tone at the Top on Misreporting Behavior

Journal of Business Ethics - While there is an extensive body of literature about the impact of sharing physical space on ethical consumption, and a growing body of literature that addresses the...     

青云创投:利成于益

Doing Well By Doing Good——做好事才能做好生意,越来越多的企业开始引用和信奉这句话。我们在此次的企业公民案例中报道的社会责任投资公司——青云创投按照中国人的语言习惯,将其翻译为利成于益,并作为自己的企业理念。跟一般的慈善行为不同,企业公民行为追求社会利益与企业自身利益的和谐,社会、环境和企业的三重盈余。而越来越多的企业也开始运用自己做好生意的能力来做好事,比如在此次我们报道的其他企业公民案例中,合众人寿利用自己庞大的业务员队伍来实现对真正需要财务资助学生的人肉搜索,惠氏利用专业组织来提升公益活动的效率和独立性,百事公司利用自己擅长的水处理能力帮助水资源匮乏的西北地区,这些企业在为社会、为环境创造价值的同时,自身也在实践着一种超越支票本式慈善的履责主义。     

Tone at the Top: An Ethics Code for Directors?

Recent corporate scandals have focused the attention of a broad set of constituencies on reforming corporate governance. Boards of directors play a leading role in corporate governance and any significant reforms must encompass their role. To date, most reform proposals have targeted the legal, rather than the ethical obligations of directors. Legal reforms without proper attention to ethical obligations will likely prove ineffectual. The ethical role of directors is critical. Directors have overall responsibility for the ethics and compliance programs of the corporation. The tone at the top that they set by example and action is central to the overall ethical environment of their firms. This role is reinforced by their legal responsibilities to provide oversight of the financial performance of the firm. Underlying this analysis is the critical assumption that ethical behavior, especially on the part of corporate leaders, leads to the best long-term interests of the corporation. We describe key components of a framework for a code of ethics for corporate boards and individual directors. The proposed code framework is based on six universal core ethical values: (1) honesty; (2) integrity; (3) loyalty; (4) responsibility; (5) fairness; and (6) citizenship. The paper concludes by suggesting critical issues that need to be dealt with in firm-based codes of ethics for directors.     

Conceptualization and Measurement of Virtuous Leadership: Doing Well by Doing Good

Despite a long history in eastern and western culture of defining leadership in terms of virtues and character, their significance for guiding leader behavior has largely been confined to the ethics literature. As such, agreement concerning the defining elements of virtuous leadership and their measurement is lacking. Drawing on both Confucian and Aristotelian concepts, we define virtuous leadership and distinguish it conceptually from several related perspectives, including virtues-based leadership in the Positive organizational behavior literature, and from ethical and value-laden (spiritual, servant, charismatic, transformational, and authentic) leadership. Then, two empirical studies are presented that develop and validate the Virtuous Leadership Questionnaire (VLQ), an 18-item behaviorally based assessment of the construct. Among other findings, we show that the VLQ accounts for variance in several outcome variables, even after self-assessed leader virtue and subordinate-rated social and personalized leader charisma are controlled.     

Feeling Good by Doing Good: Employee CSR-Induced Attributions, Job Satisfaction, and the Role of Charismatic Leadership

Interest in corporate social responsibility (CSR) is gaining momentum in academic and managerial circles. However, prior work in the area has paid little attention to how CSR initiatives should be implemented inside the organization. Against this backdrop, this study examines the impact of CSR initiatives on an important stakeholder group—employees. We build and test a comprehensive multilevel framework that focuses on whether employees derive job satisfaction from CSR programs. The proposed model predicts that a manager’s charismatic leadership influences employees’ interpretations about the motives underlying their companies’ engagement in CSR initiatives (intrinsic and extrinsic CSR-induced attributions) which, in turn, influence employee job satisfaction. Hierarchical linear modeling of data from 47 organizational units comprising 438 employees from three world-leading manufacturing organizations shows that when employees think that their manager possesses charismatic leadership qualities, they tend to attribute the organization’s motives for engaging in CSR activities to intrinsic values, which, in turn, are positively associated with job satisfaction. Also, the extent to which managers are perceived as charismatic leaders relates positively to job satisfaction. Interestingly, CSR-induced extrinsic attributions are neither explained by charismatic leadership nor do they predict job satisfaction. Implications for both theory and practice are discussed.     

CSR-Based Political Legitimacy Strategy: Managing the State by Doing Good in China and Russia

The state is a key driver of corporate social responsibility across developed and developing countries. But the existing research provides comparatively little knowledge about: (1) how companies strategically manage the relationship with the state through corporate social responsibility (CSR); (2) how this strategy takes shape under the influence of political institutions. Understanding these questions captures a realistic picture of how a company applies CSR to interacting with the state, particularly in countries where the state relationship is critical to the business operation. This article draws on political legitimacy as a useful concept to directly address both strategic and politically embedded natures of CSR. This work extends the currently under-specified political implication of the strategic view of CSR and provides fresh insights to the political legitimacy research by specifying a typology of CSR-based legitimacy strategies and its contextual variation. China and Russia are the focal settings. A qualitative analysis of business?Cstate interaction cases is done using a database that contains the majority of CSR reports published in Chinese and Russian as the end of 2009. As a result, this paper identifies four qualitatively different types of CSR-based political legitimacy strategies and reveals how the adoption of these strategies differs across Chinese companies, Russian companies, and multinational corporations.     

To Do Well by Doing Good: Improving Corporate Image Through Cause-Related Marketing

As part of their corporate social responsibility, many organizations practice cause-related marketing, in which organizations donate to a chosen cause with every consumer purchase. The extant literature has identified the importance of the fit between the organization and the nature of the cause in influencing corporate image, as well as the influence of a connection between the cause and consumer preferences on brand attitudes and brand choice. However, prior research has not addressed which cause composition most appeals to consumers or the impact of cause choice on corporate image. A between-subjects field experiment in the Netherlands examines the influence of three core cause attributes??cause type, cause scope, and cause acuteness??on consumers?? perceptions of corporate image. Furthermore, this experiment examines the extent to which consumer identification with the cause mediates the influence of the cause attributes on corporate image. The findings indicate that identification with the cause leads to more positive evaluations of marketing campaigns for cause type and cause scope. Also, however, our results uncover a negative direct relationship between cause scope and corporate image. Cause acuteness is only marginally influential in corporate image perceptions. By proposing and testing a comprehensive model of the influence of cause attributes on corporate image in cause-related marketing, this article provides important implications and suggests avenues for further research.     

Supervising the Unethical Selling Behavior of Top Sales Performers: Assessing the Impact of Social Desirability Bias

This study measures social desirability bias (SD bias) by comparing the level of discipline sales managers believe they would administer when supervising unethical selling behavior with the level of discipline they perceive other sales managers would select. Results indicate the presence of SD bias; the sales manager respondents consistently claimed that they would be stricter while their peers would be more lenient. Using an analytical technique that takes social desirability bias into account, it appears that sales managers use of discipline is affected by the sales performance of the salesperson being disciplined resulting in more lenient discipline for top sales performers. In addition, the more lenient treatment for top sales performers persists even when there is a pattern of a prior ethical infraction and the existence of an explicit organizational policy proscribing the act in question. Sales managers believe that, like themselves, others would be stricter when an unethical act is committed for the second time but not as strict as they personally would be. A within-subjects interaction effect indicates more SD bias under the condition of the unethical act being committed for the second time.     

How Good Are the UK VAT Registration Data at Measuring Firm Births?

This paper utilises some data from a survey of recent VAT registrations in the North of England to examine two issues: first, the extent to which registrants are involved in setting up entirely new businesses; and secondly, the relationship between the date of registration and the start of trading. The paper suggests that some caution should be exercised in the use of VAT registration statistics in the analysis of firm births.     

认清形势,把握机遇,做好工作

本文认为,目前我国流通市场中存在的问题主要是:市场体系不健全,市场流通二元化格局依然存在,全国统一市场尚未形成,流通中政企不分的现象远未消除,对流通的宏观调控缺乏经验和效率,流通对外开放与国家经济安全之间的关系有待厘清,流通秩序紊乱,流通规制建设滞后,流通创新严重匮乏等。文章认为,十一五规划对流通工作给予了高度重视,我国市场流通工作面临十分有利的形势,中国市场学会今后要进一步做好政府委托课题的研究;加强与企业界联系,主动为企业提供高质量的服务;搞好基层建设,积极为中心城市服务;与相关院校合作,建立流通研究基地,开展重大课题研究,推动流通理论创新和国际学术交流,扩大中国流通理论界的国际影响,同时推进流通研究网络建设。     

Not Good,Not Bad: The Effect of Family Control on Environmental Performance Disclosure by Business Group Firms

In this study, we examine the influence of senior leadership on firms’ corporate social responsibility (CSR). We integrate upper echelons research that has investigated either the influence of the CEO or the top management team (TMT) on CSR. We contend that functional experience complementarity between CEOs and TMTs in formulating and implementing CSR strategy may underlie differentiated strategies in CSR. We find that when CEOs who have predominant experience in output functions are complemented by TMTs with a lower proportion of members who have experience in output functions, there is a pronounced effect on the community, product, and diversity dimensions of CSR. In turn, when output-oriented CEOs are complemented by output-oriented TMTs, we observe an effect on the employee relations dimension of CSR. Interestingly, we find no influence of CEO-TMT complementarity on the environment dimension of CSR. In general, our empirical results support the relevance of the interaction between CEOs and their TMTs in defining their firms’ CSR profile.     

Good Apples,Bad Apples: Sorting Among Chinese Companies Traded in the U.S.

Committing financial fraud is a serious breach of business ethics. However, there are few large scale studies of financial fraud, which involve ethical considerations. In this study, we investigate the pervasive financial scandals, which by the end of 2012 involved more than a third of the US-listed Chinese companies. Based on a sample of 262 US-listed Chinese companies, we analyze factors that differentiate between firms that commit financial fraud and those that do not. We find that firms more predisposed to unethical behavior, due to their low regional social trust in the home country and low respect for regulations and laws as proxied by political connections, are more likely to commit accounting and financial fraud. They take advantage of low hurdles for listing via reverse mergers and avoid third-party monitoring through poor governance and auditors. Finally, we find evidence, after these scandals, of non-fraudulent firms differentiating themselves from the fraudulent firms by sending costly signals such as insiders purchasing shares, increasing dividends, and going private.     

Persistence and Change at the Top of the IT Sector

We use the DATAMATION index of the top 50 domestic IT companies (1975–1995) to track persistence and change at the top of the sector. The trends that we uncover are increasing instability, rejuvenation (declining average age of entrants coupled with increasing average age of quitters), democratization (diminishing revenue inequality at the top) and growing supply‐side intertwining of sub‐sectors and industries within IT due to diversification by long‐term survivors.     

On the Go: How Mobile Shopping Affects Customer Purchase Behavior

Mobile shopping (M-shopping) has become increasingly important in marketing and retailing. Using a unique dataset from an Internet-based grocery retailer, we evaluate changes in customers’ spending behavior upon adopting M-shopping, i.e., using smartphones or tablets to compose, modify, or place orders online. We find that order rate, i.e., number of orders placed per year, increases as customers adopt M-shopping. Especially for low-spending customers, both their order rate and order size, i.e., the amount of the order in dollars, increase as they become accustomed to M-shopping. In addition to the effect on customer's spending behavior, we also find that M-shoppers tend to use mobile devices to shop for habitual products that they already have a history of purchasing. We propose that customers utilize mobile devices because the technology provides convenient access, which leads them to incorporate M-shopping into their habitual routines. Managerially, we recommend that firms should fully leverage their mobile platforms, but they should also keep in mind that mobile devices may not be the most optimal channel for launching new products or promoting products that require more consideration during the buying process.     

子女数量与家庭消费行为:影响效应及作用机制

基于CFPS微观调查数据,重点探讨子女数量变动对家庭消费水平和消费结构的影响,并考察其内在作用机制,发现:(1)从整体上来看,在采取工具变量法处理内生性问题后,子女数量的增加能显著提高家庭人均消费水平和发展享乐型消费支出的占比.(2)当户主年龄小于40岁时,子女数量增加会对家庭人均消费水平以及发展享乐型消费支出占比带来负面影响,而对于户主年龄为其他分组的家庭,子女数量与家庭人均消费水平以及发展享乐型消费支出占比均呈正相关关系.(3)子女数量对家庭消费行为的影响在城乡之间存在异质性,子女数量对农村家庭人均消费水平的正向效应大于城镇家庭,但对城镇家庭发展享乐型消费支出占比的提升作用大于农村家庭.(4)从作用机制来看,子女数量的增加一方面通过减少家庭预防性储蓄直接提高家庭消费水平以及发展享乐型消费支出占比;另一方面也通过家庭房屋资产的增值间接对家庭消费行为产生影响.房屋价值在子女数量对家庭人均消费水平以及发展享乐型消费支出占比的影响路径上均起到了部分中介作用,但这种中介效应存在城乡异质性.     

Business Ethics: A Quantitative Analysis of the Impact of Unethical Behavior by Publicly Traded Corporations

This study examines whether the financial markets penalize public corporations for unethical business practices. Using event study methodology, it is found that upon the announcement that a firm is under investigation or has in some way engaged in unethical behavior, a statistically significant negative abnormal (excess) return is found. This suggests that firms are indeed penalized for their unethical actions.