IDEAS home Printed from https://ideas.repec.org/a/eee/bushor/v58y2015i2p193-201.html
   My bibliography  Save this article

Managing corporate crisis in China: Sentiment, reason, and law

Author

Listed:
  • Yang, Zhilin
  • Jiang, Ling (Alice)

Abstract

Why has the incidence of corporate crisis risen markedly in China? Why are foreign firms frequently targeted by the Chinese authorities and how should they deal with it? Addressing these pivotal questions is essential for effective management of corporate crisis in the Chinese market. Herein, we describe the background of relevant institutional and market environments in China. Then we introduce three prominent principles deeply rooted in Chinese thinking and business practice—sentiment, reason, and law—and pinpoint how they relate to crisis management. Several cases drawn from well-known corporate crises are utilized to illustrate the dynamic relationships among these three fundamental principles. We proceed to highlight the importance of sentiment and emphasize the delicate balance between sentiment and law. Finally, we elaborate how different forms of institutional capital and social media can be employed to manage sentiment, reason, and law so as to curtail and tackle corporate crisis.

Suggested Citation

  • Yang, Zhilin & Jiang, Ling (Alice), 2015. "Managing corporate crisis in China: Sentiment, reason, and law," Business Horizons, Elsevier, vol. 58(2), pages 193-201.
    • Handle: RePEc:eee:bushor:v:58:y:2015:i:2:p:193-201
    DOI: 10.1016/j.bushor.2014.11.003
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S000768131400158X
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.bushor.2014.11.003?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
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Berman, Barry & Swani, Kunal, 2010. "Managing product safety of imported Chinese goods," Business Horizons, Elsevier, vol. 53(1), pages 39-48, January.
    2. Rudi K. F. Bresser & Klemens Millonig, 2003. "Institutional Capital: Competitive Advantage In Light Of The N Ew Institutionalism In Organization Theory," Schmalenbach Business Review (sbr), LMU Munich School of Management, vol. 55(3), pages 220-241, July.
    3. Zhao, Meng, 2013. "Beyond cops and robbers: The contextual challenge driving the multinational corporation public crisis in China and Russia," Business Horizons, Elsevier, vol. 56(4), pages 491-501.
    4. Laufer, Daniel & Coombs, W. Timothy, 2006. "How should a company respond to a product harm crisis? The role of corporate reputation and consumer-based cues," Business Horizons, Elsevier, vol. 49(5), pages 379-385.
    5. Yang, Zhilin & Su, Chenting, 2013. "Understanding Asian business strategy: Modeling institution-based legitimacy-embedded efficiency," Journal of Business Research, Elsevier, vol. 66(12), pages 2369-2374.
    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. Margherita, Alessandro & Heikkilä, Marikka, 2021. "Business continuity in the COVID-19 emergency: A framework of actions undertaken by world-leading companies," Business Horizons, Elsevier, vol. 64(5), pages 683-695.
    2. Wang, Yijing & Laufer, Daniel, 2020. "How does crisis management in China differ from the West?: A review of the literature and directions for future research," Journal of International Management, Elsevier, vol. 26(1).
    3. Sáenz, María Jesús & Revilla, Elena & Acero, Beatriz, 2018. "Aligning supply chain design for boosting resilience," Business Horizons, Elsevier, vol. 61(3), pages 443-452.
    4. A. J. Guerber & Vikas Anand & Alan E. Ellstrand & Matthew A. Waller & Iris Reychav, 2020. "Extending the Situational Crisis Communication Theory: The Impact of Linguistic Style and Culture," Corporate Reputation Review, Palgrave Macmillan, vol. 23(2), pages 106-127, May.
    5. Young, Michael N. & Bruton, Garry D. & Peng, Mike W. & Yu, Xiaoyu, 2022. "U.S. corporations are from Mars, Chinese corporations are from Venus," Business Horizons, Elsevier, vol. 65(4), pages 505-517.

    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. Li, Huashan & Bapuji, Hari & Talluri, Srinivas & Singh, Prakash J., 2022. "A Cross-disciplinary review of product recall research: A stakeholder-stage framework," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 163(C).
    2. Chen Zhou & Shrihari Sridhar & Rafael Becerril-Arreola & Tony Haitao Cui & Yan Dong, 2019. "Promotions as competitive reactions to recalls and their consequences," Journal of the Academy of Marketing Science, Springer, vol. 47(4), pages 702-722, July.
    3. 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.
    4. Miranda J. Welbourne Eleazar, 2022. "Immoral Entrenchment: How Crisis Reverses the Ethical Effects of Moral Intensity," Journal of Business Ethics, Springer, vol. 180(1), pages 71-89, September.
    5. Shao‐Chi Chang & Heng‐Yu Chang, 2015. "Corporate Motivations of Product Recall Strategy: Exploring the Role of Corporate Social Responsibility in Stakeholder Engagement," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 22(6), pages 393-407, November.
    6. Grégoire, Yany & Salle, Audrey & Tripp, Thomas M., 2015. "Managing social media crises with your customers: The good, the bad, and the ugly," Business Horizons, Elsevier, vol. 58(2), pages 173-182.
    7. Amélie Guèvremont & Bianca Grohmann, 2018. "Does brand authenticity alleviate the effect of brand scandals?," Journal of Brand Management, Palgrave Macmillan, vol. 25(4), pages 322-336, July.
    8. Hill Cummings, Krista & Seitchik, Allison E., 2020. "The differential treatment of women during service recovery: How perceived social power affects consumers’ postfailure compensation," Business Horizons, Elsevier, vol. 63(5), pages 647-658.
    9. Patel, Pankaj C. & Pearce, John A. & Bachrach, Daniel G., 2018. "Psychological Distress is increasing among customer-facing retail employees: Evidence from 1997 to 2015," Journal of Business Research, Elsevier, vol. 89(C), pages 21-26.
    10. Hsu, Liwu & Lawrence, Benjamin, 2016. "The role of social media and brand equity during a product recall crisis: A shareholder value perspective," International Journal of Research in Marketing, Elsevier, vol. 33(1), pages 59-77.
    11. Chonnatcha Kungwansupaphan & Jibon Kumar Sharma Leihaothabam, 2019. "Entrepreneurial Orientation, Performance And The Moderating Role Of Institutional Capital: A Case Study Of Female Entrepreneurs In Thailand," Journal of Developmental Entrepreneurship (JDE), World Scientific Publishing Co. Pte. Ltd., vol. 24(02), pages 1-20, June.
    12. Cockrell, Seth & Friske, Wesley & Voorhees, Clay M. & Calantone, Roger J., 2024. "The effects of innovation on product recall likelihood," Journal of Business Research, Elsevier, vol. 173(C).
    13. Thomas Koch & Nora Denner & Benno Viererbl & Sascha Himmelreich, 2019. "Corporate Responses to Critical Journalistic Interview Requests: An Experimental Study on Crisis Prevention," Corporate Reputation Review, Palgrave Macmillan, vol. 22(1), pages 1-9, February.
    14. Dong Lu & Yide Liu & Hongfeng Zhang & Ivan K. W. Lai, 2016. "The Ethical Judgment and Moral Reaction to the Product-Harm Crisis: Theoretical Model and Empirical Research," Sustainability, MDPI, vol. 8(7), pages 1-17, July.
    15. Liu, Yang & Ouyang, Zhe & He, Mujia, 2022. "Why and when firms respond accommodatively to the product-harm crisis: An institutional perspective," Journal of Retailing and Consumer Services, Elsevier, vol. 68(C).
    16. Paul, Bénédique, 2009. "Reclaiming Institutions as a Form of Capital," MPRA Paper 39017, University Library of Munich, Germany.
    17. Aparna Katre & Paul Salipante, 2012. "Start–Up Social Ventures: Blending Fine–Grained Behaviors from Two Institutions for Entrepreneurial Success," Entrepreneurship Theory and Practice, , vol. 36(5), pages 967-994, September.
    18. Kenworthy, Thomas P. & Verbeke, Alain, 2015. "The future of strategic management research: Assessing the quality of theory borrowing," European Management Journal, Elsevier, vol. 33(3), pages 179-190.
    19. Zhao, Xi & Lin, Chunyi & Knerr-Sievers, Beatrice & Lu, Qiuting & Mardani, Abbas, 2023. "The impact of institutional environment on entrepreneurial performance in micro E-commerce for Women: The mediating role of entrepreneurial network," Journal of Business Research, Elsevier, vol. 154(C).
    20. Janssen, Catherine & Sen, Sankar & Bhattacharya, CB, 2015. "Corporate crises in the age of corporate social responsibility," Business Horizons, Elsevier, vol. 58(2), pages 183-192.

    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:eee:bushor:v:58:y:2015:i:2:p:193-201. 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: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/bushor .

    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.