IDEAS home Printed from https://ideas.repec.org/a/bla/bstrat/v29y2020i4p1797-1808.html
   My bibliography  Save this article

Crisis spillover of corporate environmental misconducts: The roles of perceived similarity, familiarity, and corporate environmental responsibility in determining the impact on oppositional behavioral intention

Author

Listed:
  • Zhe Ouyang
  • Chris Nengzhi Yao
  • Xi Hu

Abstract

Negative impact of a firm's environmental misconduct can spread to other firms under the same category due to stakeholders' categorization. Such problem implies a sociocognitive process that has yet to be explored. Therefore, this study extends the current literature by exploring how interfirm similarity affects the spillover effects through stakeholders' engagement. We propose that interfirm similarity can be perceived by stakeholders as a categorization standard, which can lead to their opposition to other firms. Spillover of misconduct is caused by the decreasing stakeholders' trust, wherein the negative effect is contingent upon stakeholders' perceptions. A questionnaire study is conducted to investigate how people resist an innocent firm in China when a chemistry firm experienced an explosion accident. Our findings confirm that interfirm similarity increases stakeholders' opposition to the innocent firm by decreasing their trust. However, the negative effect is alleviated when the innocent firm is perceived as highly environmentally responsible. Our work contributes to the crisis spillover literature and carries important implications for the management of innocent firms that may lose from an industry peer's misconduct.

Suggested Citation

  • Zhe Ouyang & Chris Nengzhi Yao & Xi Hu, 2020. "Crisis spillover of corporate environmental misconducts: The roles of perceived similarity, familiarity, and corporate environmental responsibility in determining the impact on oppositional behavioral," Business Strategy and the Environment, Wiley Blackwell, vol. 29(4), pages 1797-1808, May.
  • Handle: RePEc:bla:bstrat:v:29:y:2020:i:4:p:1797-1808
    DOI: 10.1002/bse.2474
    as

    Download full text from publisher

    File URL: https://doi.org/10.1002/bse.2474
    Download Restriction: no

    File URL: https://libkey.io/10.1002/bse.2474?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    References listed on IDEAS

    as
    1. Noushi Rahman & Corinne Post, 2012. "Measurement Issues in Environmental Corporate Social Responsibility (ECSR): Toward a Transparent, Reliable, and Construct Valid Instrument," Journal of Business Ethics, Springer, vol. 105(3), pages 307-319, February.
    2. Chieh-Peng Lin & Shwu-Chuan Chen & Chou-Kang Chiu & Wan-Yu Lee, 2011. "Understanding Purchase Intention During Product-Harm Crises: Moderating Effects of Perceived Corporate Ability and Corporate Social Responsibility," Journal of Business Ethics, Springer, vol. 102(3), pages 455-471, September.
    3. Jung Lee & Jae-Nam Lee & Bernard C. Y. Tan, 2015. "Antecedents of cognitive trust and affective distrust and their mediating roles in building customer loyalty," Information Systems Frontiers, Springer, vol. 17(1), pages 159-175, February.
    4. H. L. Zou & R. C. Zeng & S. X. Zeng & Jonathan J. Shi, 2015. "How Do Environmental Violation Events Harm Corporate Reputation?," Business Strategy and the Environment, Wiley Blackwell, vol. 24(8), pages 836-854, December.
    5. Jiuchang Wei & Fei Wang & Michael K. Lindell, 2016. "The evolution of stakeholders' perceptions of disaster: A model of information flow," Journal of the Association for Information Science & Technology, Association for Information Science & Technology, vol. 67(2), pages 441-453, February.
    6. Johnson, Devon & Grayson, Kent, 2005. "Cognitive and affective trust in service relationships," Journal of Business Research, Elsevier, vol. 58(4), pages 500-507, April.
    7. Jiuchang Wei & Ming Zhao & Fei Wang & Peng Cheng & Dingtao Zhao, 2016. "An Empirical Study of the Volkswagen Crisis in China: Customers’ Information Processing and Behavioral Intentions," Risk Analysis, John Wiley & Sons, vol. 36(1), pages 114-129, January.
    8. Francesco Perrini & Sandro Castaldo & Nicola Misani & Antonio Tencati, 2010. "The impact of corporate social responsibility associations on trust in organic products marketed by mainstream retailers: a study of Italian consumers," Business Strategy and the Environment, Wiley Blackwell, vol. 19(8), pages 512-526, December.
    9. Naresh K. Malhotra & Sung S. Kim & Ashutosh Patil, 2006. "Common Method Variance in IS Research: A Comparison of Alternative Approaches and a Reanalysis of Past Research," Management Science, INFORMS, vol. 52(12), pages 1865-1883, December.
    10. Daniel Reimsbach & Rüdiger Hahn, 2015. "The Effects of Negative Incidents in Sustainability Reporting on Investors’ Judgments–an Experimental Study of Third‐party Versus Self‐disclosure in the Realm of Sustainable Development," Business Strategy and the Environment, Wiley Blackwell, vol. 24(4), pages 217-235, May.
    11. Menon, Geeta & Raghubir, Priya & Schwarz, Norbert, 1995. "Behavioral Frequency Judgments: An Accessibility-Diagnosticity Framework," Journal of Consumer Research, Journal of Consumer Research Inc., vol. 22(2), pages 212-228, September.
    12. Xingqiang Du, 2015. "Is Corporate Philanthropy Used as Environmental Misconduct Dressing? Evidence from Chinese Family-Owned Firms," Journal of Business Ethics, Springer, vol. 129(2), pages 341-361, June.
    13. Rao, Akshay R & Monroe, Kent B, 1988. "The Moderating Effect of Prior Knowledge on Cue Utilization in Product Evaluations," Journal of Consumer Research, Journal of Consumer Research Inc., vol. 15(2), pages 253-264, September.
    14. Jiuchang Wei & Zhe Ouyang & Haipeng (Allan) Chen, 2017. "Well Known or Well Liked? The Effects of Corporate Reputation on Firm Value at the Onset of a Corporate Crisis," Strategic Management Journal, Wiley Blackwell, vol. 38(10), pages 2103-2120, October.
    15. Michael K. Lindell & Ronald W. Perry, 2012. "The Protective Action Decision Model: Theoretical Modifications and Additional Evidence," Risk Analysis, John Wiley & Sons, vol. 32(4), pages 616-632, April.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Jiafeng Gu, 2021. "Spatial Dynamics between Firm Sales and Environmental Responsibility: The Mediating Role of Corporate Innovation," Sustainability, MDPI, vol. 13(4), pages 1-18, February.
    2. Yassin Denis Bouzzine & Rainer Lueg, 2020. "The contagion effect of environmental violations: The case of Dieselgate in Germany," Business Strategy and the Environment, Wiley Blackwell, vol. 29(8), pages 3187-3202, December.
    3. Isabel Marques & João Leitão & Alba Carvalho & Dina Pereira, 2021. "Public Administration and Values Oriented to Sustainability: A Systematic Approach to the Literature," Sustainability, MDPI, vol. 13(5), pages 1-27, February.
    4. Yihua Wu & Muhammad Farrukh & Ali Raza & Fanchen Meng & Imtiaz Alam, 2021. "Framing the evolution of the corporate social responsibility and environmental management journal," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 28(4), pages 1397-1411, July.
    5. Olawole Fawehinmi & Mohd Yusoff Yusliza & Samuel Ogbeibu & M. Imran Tanveer & Charbel Jose Chiappetta Jabbour, 2022. "Academic employees' green behaviour as praxis for bolstering environmental sustainable development: A linear moderated mediation evaluation," Business Strategy and the Environment, Wiley Blackwell, vol. 31(7), pages 3470-3490, November.
    6. Faheem Gul Gilal & Naeem Gul Gilal & Nisar Ahmed Channa & Rehman Gul Gilal & Rukhsana Gul Gilal & Muhammad Nawaz Tunio, 2020. "Towards an integrated model for the transference of environmental responsibility," Business Strategy and the Environment, Wiley Blackwell, vol. 29(6), pages 2614-2623, September.
    7. Ma, Yechi & Ding, Yibing & Wang, Zilong & Zhang, Wenjing, 2023. "Building trust after pollution emergency: A strategic perspective on corporate social responsibility," Energy Economics, Elsevier, vol. 126(C).
    8. Md. Aftab Uddin & Shetu Ranjan Biswas & Swadip Bhattacharjee & Mouri Dey & Monowar Mahmood, 2021. "Inspiring employees' ecological behaviors: The roles of corporate environmental strategy, biospheric values, and eco‐centric leadership," Business Strategy and the Environment, Wiley Blackwell, vol. 30(5), pages 2367-2381, July.
    9. Dorit Zimand-Sheiner & Shalom Levy & Eyal Eckhaus, 2021. "Exploring Negative Spillover Effects on Stakeholders: A Case Study on Social Media Talk about Crisis in the Food Industry Using Data Mining," Sustainability, MDPI, vol. 13(19), pages 1-16, September.
    10. Md Mosharraf Hossain & Lafang Wang & Jing Yu, 2024. "The reputational costs of corporate environmental underperformance: evidence from China," Business Strategy and the Environment, Wiley Blackwell, vol. 33(2), pages 930-948, February.
    11. Sveinung Jørgensen & Lars Jacob Tynes Pedersen & Siv Skard, 2022. "How going green builds trusting beliefs," Business Strategy and the Environment, Wiley Blackwell, vol. 31(1), pages 297-311, January.

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Zhe Ouyang & Ruixue Lv & Yang Liu, 2023. "Can corporate social responsibility protect firm value during corporate environmental violation events?," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 30(4), pages 1942-1952, July.
    2. Dong-Hong Zhu & Ya-Ping Chang, 2013. "Negative Publicity Effect of the Business Founder’s Unethical Behavior on Corporate Image: Evidence from China," Journal of Business Ethics, Springer, vol. 117(1), pages 111-121, September.
    3. Yuanyuan Zhang & Zhe Ouyang, 2021. "Doing well by doing good: How corporate environmental responsibility influences corporate financial performance," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 28(1), pages 54-63, January.
    4. Wang, Fei & Yuan, Yu & Lu, Liangdong, 2021. "Dynamical prediction model of consumers’ purchase intentions regarding anti-smog products during smog risk: Taking the information flow perspective," Physica A: Statistical Mechanics and its Applications, Elsevier, vol. 563(C).
    5. Wu, Bao & Jin, Chenfei & Monfort, Abel & Hua, Danni, 2021. "Generous charity to preserve green image? Exploring linkage between strategic donations and environmental misconduct," Journal of Business Research, Elsevier, vol. 131(C), pages 839-850.
    6. Zhe Ouyang & Qian Sun & Yang Liu, 2024. "The impact of investor reaction to crisis events on corporate philanthropy: evidence from Chinese firms," Asian Business & Management, Palgrave Macmillan, vol. 23(1), pages 139-163, February.
    7. Li, Xinlan & Li, Changhong & Guo, Xiaoli, 2023. "Environmental practices, family control, and corporate performance: Evidence from Chinese family firms," Emerging Markets Review, Elsevier, vol. 55(C).
    8. Stefano Caiazza & Giuseppe Galloppo & Gabriele Lattanzio, 2023. "Industrial accidents: The mediating effect of corporate social responsibility and environmental policy measures," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 30(3), pages 1191-1203, May.
    9. Diallo, Mbaye Fall & Seck, Anne Marianne, 2018. "How store service quality affects attitude toward store brands in emerging countries: Effects of brand cues and the cultural context," Journal of Business Research, Elsevier, vol. 86(C), pages 311-320.
    10. Vincenza Capone & Daniela Caso & Anna Rosa Donizzetti & Fortuna Procentese, 2020. "University Student Mental Well-Being during COVID-19 Outbreak: What Are the Relationships between Information Seeking, Perceived Risk and Personal Resources Related to the Academic Context?," Sustainability, MDPI, vol. 12(17), pages 1-17, August.
    11. Kazlauskienė Asta, 2018. "Industry Specifics and Consumers’ Reactions to Business Crises," Acta Universitatis Sapientiae, Economics and Business, Sciendo, vol. 32(1), pages 5-20, December.
    12. Gilboa, Shaked & Seger-Guttmann, Tali & Mimran, Ofir, 2019. "The unique role of relationship marketing in small businesses’ customer experience," Journal of Retailing and Consumer Services, Elsevier, vol. 51(C), pages 152-164.
    13. Xingqiang Du & Wei Jian & Quan Zeng & Yingying Chang, 2018. "Do Auditors Applaud Corporate Environmental Performance? Evidence from China," Journal of Business Ethics, Springer, vol. 151(4), pages 1049-1080, September.
    14. Tiezhong Liu & Huyuan Zhang & Hubo Zhang, 2020. "The Influence of Social Capital on Protective Action Perceptions Towards Hazardous Chemicals," IJERPH, MDPI, vol. 17(4), pages 1-12, February.
    15. Chai, Joe Choon Yean & Malhotra, Naresh K. & Alpert, Frank, 2015. "A two-dimensional model of trust–value–loyalty in service relationships," Journal of Retailing and Consumer Services, Elsevier, vol. 26(C), pages 23-31.
    16. Manuela Gomez‐Valencia & Maria Alejandra Gonzalez‐Perez & Ana Maria Gomez‐Trujillo, 2021. "The “Six Ws” of sustainable development risks," Business Strategy and the Environment, Wiley Blackwell, vol. 30(7), pages 3131-3144, November.
    17. Shi, Lulu & Liu, Yi, 2024. "Potential alliance partners' reactions to focal firm misconduct: Incongruence across capability and character reputation," Technological Forecasting and Social Change, Elsevier, vol. 203(C).
    18. Lombart, Cindy & Louis, Didier, 2016. "Sources of retailer personality: Private brand perceptions," Journal of Retailing and Consumer Services, Elsevier, vol. 28(C), pages 117-125.
    19. Wei Liu & Qiao Wei & Song-Qin Huang & Sang-Bing Tsai, 2017. "Doing Good Again? A Multilevel Institutional Perspective on Corporate Environmental Responsibility and Philanthropic Strategy," IJERPH, MDPI, vol. 14(10), pages 1-15, October.
    20. Robert L. Heath & Jaesub Lee & Michael J. Palenchar & Laura L. Lemon, 2018. "Risk Communication Emergency Response Preparedness: Contextual Assessment of the Protective Action Decision Model," Risk Analysis, John Wiley & Sons, vol. 38(2), pages 333-344, February.

    More about this item

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:bla:bstrat:v:29:y:2020:i:4:p:1797-1808. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Wiley Content Delivery (email available below). General contact details of provider: http://onlinelibrary.wiley.com/journal/10.1002/(ISSN)1099-0836 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.