Article

Does Reputation Work to Discipline Corporatemisconduct?

Jonathan M. Karpoff

in The Oxford Handbook of Corporate Reputation

Published in print July 2012 | ISBN: 9780199596706
Published online November 2012 | | DOI: http://dx.doi.org/10.1093/oxfordhb/9780199596706.013.0018

Series: Oxford Handbooks in Business and Management

 Does Reputation Work to Discipline Corporatemisconduct?

More Like This

Show all results sharing these subjects:

  • Business and Management
  • Business Strategy
  • Organizational Theory and Behaviour

GO

Show Summary Details

Preview

This article tries to answer a fundamental question about the importance of reputation–does it actually work to discipline firm misconduct?– and also addresses the empirical research on the significance of reputational penalties for corporate misconduct. The reputational loss occurs because of direct impairments to the firm's ongoing operations, and also because counterparties alter the terms with which they are willing to continue to do business with the firm. The article then illustrates that firms engaging in many types of misconduct incur large reputational losses. In general, the data indicates that firms experience significant reputational losses when their misconduct imposes costs on their counterparties. Reputation plays a small role in disciplining environmental violations, and regulations and legal penalties play a more important role. Furthermore, there are large consequences for firms and managers that are caught engaging in misconduct.

Keywords: reputation; firm misconduct; corporate misconduct; reputational penalties; reputational losses; regulations; legal penalties

Article.  9415 words. 

Subjects: Business and Management ; Business Strategy ; Organizational Theory and Behaviour

Full text: subscription required

How to subscribe Recommend to my Librarian

Buy this work at Oxford University Press »

Users without a subscription are not able to see the full content. Please, subscribe or login to access all content.