IDEAS home Printed from https://ideas.repec.org/a/gam/jsusta/v13y2021i24p13835-d702659.html
   My bibliography  Save this article

How the Public Shaming of Peers Enhances Corporate Social Performance: Evidence from Blacklisted Firms in Japan

Author

Listed:
  • Ranxin Liao

    (Department of Management, Sophia University, 7-1 Kioi-cho, Chiyoda-ku, Tokyo 102-8554, Japan)

  • Jungwon Min

    (Department of Management, Sophia University, 7-1 Kioi-cho, Chiyoda-ku, Tokyo 102-8554, Japan)

Abstract

This study aims to show how vicarious public shaming, that is the public disgrace of several peers in the same industry, affects focal firms’ corporate social performance (CSP). Drawing on the legitimacy and category theories, we suggest that since an increased vicarious public disgrace harms the legitimacy of the entire industry, peer companies attempt to negate these potential legitimacy losses by improving their CSP. This tendency is more pronounced in firms that have a poor record of CSP. Using a context of the Japanese blacklisted companies by the government for labor law delinquency between 2016 and 2019, our results confirm that vicarious public disgrace is a significant antecedent to improving CSP. Our findings also imply that the appropriate use of public disgrace can enhance overall the CSP levels.

Suggested Citation

  • Ranxin Liao & Jungwon Min, 2021. "How the Public Shaming of Peers Enhances Corporate Social Performance: Evidence from Blacklisted Firms in Japan," Sustainability, MDPI, vol. 13(24), pages 1-17, December.
    • Handle: RePEc:gam:jsusta:v:13:y:2021:i:24:p:13835-:d:702659
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/2071-1050/13/24/13835/pdf
    Download Restriction: no
    File URL: https://www.mdpi.com/2071-1050/13/24/13835/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Sandra A. Waddock & Samuel B. Graves, 1997. "The Corporate Social Performance–Financial Performance Link," Strategic Management Journal, Wiley Blackwell, vol. 18(4), pages 303-319, April.
    2. Cynthia E. Devers & Todd Dewett & Yuri Mishina & Carrie A. Belsito, 2009. "A General Theory of Organizational Stigma," Organization Science, INFORMS, vol. 20(1), pages 154-171, February.
    3. Lintang D. Sekarlangit & Ratna Wardhani, 2021. "The Effect of the Characteristics and Activities of the Board of Directors on Sustainable Development Goal (SDG) Disclosures: Empirical Evidence from Southeast Asia," Sustainability, MDPI, vol. 13(14), pages 1-17, July.
    4. Iman Harymawan & Fajar Kristanto Gautama Putra & Bayu Arie Fianto & Wan Adibah Wan Ismail, 2021. "Financially Distressed Firms: Environmental, Social, and Governance Reporting in Indonesia," Sustainability, MDPI, vol. 13(18), pages 1-18, September.
    5. Beamish, Paul W. & Inkpen, Andrew C., 1998. "Japanese firms and the decline of the Japanese expatriate," Journal of World Business, Elsevier, vol. 33(1), pages 35-50.
    6. Min, Jungwon, 2019. "No pain, yet gain?: Learning from vicarious crises in an international context," Journal of Business Research, Elsevier, vol. 97(C), pages 227-234.
    7. Ioannis Ioannou & George Serafeim, 2012. "What drives corporate social performance? The role of nation-level institutions," Journal of International Business Studies, Palgrave Macmillan;Academy of International Business, vol. 43(9), pages 834-864, December.
    8. Karen Maas, 2018. "Do Corporate Social Performance Targets in Executive Compensation Contribute to Corporate Social Performance?," Journal of Business Ethics, Springer, vol. 148(3), pages 573-585, March.
    9. Alessandro Piazza & Fabrizio Perretti, 2015. "Categorical Stigma and Firm Disengagement: Nuclear Power Generation in the United States, 1970–2000," Organization Science, INFORMS, vol. 26(3), pages 724-742, June.
    10. Lehmann, Hartmut & Wadsworth, Jonathan, 2011. "The impact of Chernobyl on health and labour market performance," Journal of Health Economics, Elsevier, vol. 30(5), pages 843-857.
    11. Laura Corazza & Elisa Truant & Simone Domenico Scagnelli & Chiara Mio, 2020. "Sustainability reporting after the Costa Concordia disaster: a multi-theory study on legitimacy, impression management and image restoration," Accounting, Auditing & Accountability Journal, Emerald Group Publishing Limited, vol. 33(8), pages 1909-1941, July.
    12. Hausman, Jerry, 2015. "Specification tests in econometrics," Applied Econometrics, Russian Presidential Academy of National Economy and Public Administration (RANEPA), vol. 38(2), pages 112-134.
    13. Croissant, Yves & Millo, Giovanni, 2008. "Panel Data Econometrics in R: The plm Package," Journal of Statistical Software, Foundation for Open Access Statistics, vol. 27(i02).
    14. Weizhang Sun & Xuan Li & Yanli Geng & Jinfeng Yang & Yifei Zhang, 2020. "Board interlocks and the diffusion of CSR reporting practices: The role of market development," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 27(3), pages 1333-1343, May.
    15. Edward J. Carberry & Brayden G King, 2012. "Defensive Practice Adoption in the Face of Organizational Stigma: Impression Management and the Diffusion of Stock Option Expensing," Journal of Management Studies, Wiley Blackwell, vol. 49(7), pages 1137-1167, November.
    16. Megumi Suto & Hitoshi Takehara, 2020. "Corporate social responsibility intensity, management earnings forecast accuracy, and investor trust: Evidence from Japan," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 27(6), pages 3047-3059, November.
    17. Yingyan Wang, 2009. "Examination on Philosophy-Based Management of Contemporary Japanese Corporations: Philosophy, Value Orientation and Performance," Journal of Business Ethics, Springer, vol. 85(1), pages 1-12, March.
    18. Thomas Roulet, 2015. "“What Good is Wall Street?” Institutional Contradiction and the Diffusion of the Stigma over the Finance Industry," Journal of Business Ethics, Springer, vol. 130(2), pages 389-402, August.
    19. Waris Ali & Yu Danni & Badar Latif & Rehana Kouser & Saleh Baqader, 2021. "Corporate Social Responsibility and Customer Loyalty in Food Chains—Mediating Role of Customer Satisfaction and Corporate Reputation," Sustainability, MDPI, vol. 13(16), pages 1-15, August.
    20. Jun Hyeok Choi & Saerona Kim & Dong-Hoon Yang & Kwanghee Cho, 2021. "Can Corporate Social Responsibility Decrease the Negative Influence of Financial Distress on Accounting Quality?," Sustainability, MDPI, vol. 13(19), pages 1-19, October.
    21. Zulhamri Abdullah & Yuhanis Abdul Aziz, 2013. "Institutionalizing corporate social responsibility: effects on corporate reputation, culture, and legitimacy in Malaysia," Social Responsibility Journal, Emerald Group Publishing Limited, vol. 9(3), pages 344-361, July.
    22. Guangtao Zeng & Yuehua Xu, 2019. "Sustainable development and the rating effects: A strategic categorization approach," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 26(6), pages 1554-1564, November.
    23. 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.
    24. Matthew Kahn, 2007. "Environmental disasters as risk regulation catalysts? The role of Bhopal, Chernobyl, Exxon Valdez, Love Canal, and Three Mile Island in shaping U.S. environmental law," Journal of Risk and Uncertainty, Springer, vol. 35(1), pages 17-43, August.
    25. Paul, Justin & Feliciano-Cestero, María M., 2021. "Five decades of research on foreign direct investment by MNEs: An overview and research agenda," Journal of Business Research, Elsevier, vol. 124(C), pages 800-812.
    26. Mobin Fatma & Imran Khan & Zillur Rahman, 2018. "Striving for legitimacy through CSR: an exploration of employees responses in controversial industry sector," Social Responsibility Journal, Emerald Group Publishing Limited, vol. 15(7), pages 924-938, November.
    27. Jelena Titko & Anna Svirina & Tatjana Tambovceva & Viktorija Skvarciany, 2021. "Differences in Attitude to Corporate Social Responsibility among Generations," Sustainability, MDPI, vol. 13(19), pages 1-12, October.
    28. William Ocasio, 1997. "Towards An Attention‐Based View Of The Firm," Strategic Management Journal, Wiley Blackwell, vol. 18(S1), pages 187-206, July.
    29. Aaron K. Chatterji & Michael W. Toffel, 2010. "How firms respond to being rated," Strategic Management Journal, Wiley Blackwell, vol. 31(9), pages 917-945, September.
    30. Hailiang Zou & Xuemei Xie & Xiaohua Meng & Mengyu Yang, 2019. "The diffusion of corporate social responsibility through social network ties: From the perspective of strategic imitation," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 26(1), pages 186-198, January.
    Full references (including those not matched with items on IDEAS)

    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. Bryant Ashley Hudson & Karen D. W. Patterson & Thomas J. Roulet & Wesley S. Helms & Kimberly Elsbach, 2022. "Organizational Stigma: Taking Stock and Opening New Areas for Research," Journal of Management Studies, Wiley Blackwell, vol. 59(8), pages 1899-1914, December.
    2. Jia Xu & Jiuchang Wei & Haipeng (Allan) Chen, 2019. "Strategic responses of stigmatized Chinese manufacturing firms to formal and informal environmental regulative pressures through enhanced corporate social responsibility effort," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 26(6), pages 1235-1260, November.
    3. Gro Kvåle & Zuzana Murdoch, 2022. "Shame On You! Unpacking the Individual and Organizational Implications of Engaging with a Stigmatized Organization," Journal of Management Studies, Wiley Blackwell, vol. 59(8), pages 2024-2066, December.
    4. Thomas Roulet, 2019. "Les Evaluations Sociales en Stratégie : Légitimité, Réputation, Statut, Stigmate et Cie," Post-Print hal-01970557, HAL.
    5. Shaista Wasiuzzaman & Ali Uyar & Cemil Kuzey & Abdullah S. Karaman, 2022. "Corporate social responsibility: Is it a matter of slack financial resources or strategy or both?," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 43(6), pages 2444-2466, September.
    6. Jia Xu & Jiuchang Wei & Liangdong Lu, 2019. "Strategic stakeholder management, environmental corporate social responsibility engagement, and financial performance of stigmatized firms derived from Chinese special environmental policy," Business Strategy and the Environment, Wiley Blackwell, vol. 28(6), pages 1027-1044, September.
    7. Shih-chi (Sana) Chiu & Azadeh Sabz, 2022. "Can Corporate Divestiture Activities Lead to Better Corporate Social Performance?," Journal of Business Ethics, Springer, vol. 179(3), pages 849-866, September.
    8. Hasan, Iftekhar & Karavitis, Panagiotis & Kazakis, Pantelis & Leung, Woon Sau, 2019. "Corporate Social Responsibility and Profit Shifting," MPRA Paper 91580, University Library of Munich, Germany.
    9. Javier Aguilera‐Caracuel & Jaime Guerrero‐Villegas, 2018. "How Corporate Social Responsibility Helps MNEs to Improve their Reputation. The Moderating Effects of Geographical Diversification and Operating in Developing Regions," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 25(4), pages 355-372, July.
    10. Ji Li & Ying Zhang & Yanghong Hu & Xiaolong Tao & Wanxing Jiang & Lei Qi, 2018. "Developed market or developing market?: A perspective of institutional theory on multinational enterprises’ diversification and sustainable development with environmental protection," Business Strategy and the Environment, Wiley Blackwell, vol. 27(7), pages 858-871, November.
    11. Shan Xue & Yuehua Xu & Honghui Chen, 2024. "Corporate social performance feedback and corporate social responsibility decoupling in China: The salience of legitimacy and/or efficiency," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 31(4), pages 3164-3180, July.
    12. Birton J. Cowden & Joshua S. Bendickson & Blake D. Mathias & Shelby J. Solomon, 2022. "Straight OUTTA Detroit: Embracing Stigma as Part of the Entrepreneurial Narrative," Journal of Management Studies, Wiley Blackwell, vol. 59(8), pages 1915-1949, December.
    13. Dewan, Yasir, 2019. "Corporate crime and punishment : The role of status and ideology," Other publications TiSEM 08d87b94-7449-4a1f-a3ae-0, Tilburg University, School of Economics and Management.
    14. Jong-Wan Bae & Sang-Joon Kim, 2022. "How Do Active Firms Implementing Corporate Environmental Responsibility Take Technological Approaches to Environmental Issues? A Resource-Allocation Perspective," Sustainability, MDPI, vol. 14(14), pages 1-13, July.
    15. Kais Bouslah & Abdelmajid Hmaittane & Lawrence Kryzanowski & Bouchra M’Zali, 2023. "CSR Structures: Evidence, Drivers, and Firm Value Implications," Journal of Business Ethics, Springer, vol. 185(1), pages 115-145, June.
    16. Ruchunyi Fu & Yi Tang & Guoli Chen, 2020. "Chief sustainability officers and corporate social (Ir)responsibility," Strategic Management Journal, Wiley Blackwell, vol. 41(4), pages 656-680, April.
    17. George I. Kassinis & Adam A. Kay & Giorgos Papagiannakis & Pavlos A. Vlachos, 2022. "Stigma as Moral Insurance: How Stigma Buffers Firms from the Market Consequences of Greenwashing," Journal of Management Studies, Wiley Blackwell, vol. 59(8), pages 2154-2190, December.
    18. Lai Si Tsui‐Auch & Dongdong Huang & Jun Jie Yang & Si Zheng Koh, 2022. "Double Trouble: Containing Public Disapproval Arising from an Interplay of Stigmatized Categories," Journal of Management Studies, Wiley Blackwell, vol. 59(8), pages 2101-2123, December.
    19. Alessandro Piazza & Grace L. Augustine, 2022. "Nevertheless, They Persisted: How Patterns of Opposition and Support Shaped the Survival of U.S. Abortion Clinics," Journal of Management Studies, Wiley Blackwell, vol. 59(8), pages 2124-2153, December.
    20. Sanne Frandsen & Mette Morsing, 2022. "Behind the Stigma Shield: Frontline Employees’ Emotional Response to Organizational Event Stigma at Work and at Home," Journal of Management Studies, Wiley Blackwell, vol. 59(8), pages 1987-2023, December.

    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:gam:jsusta:v:13:y:2021:i:24:p:13835-:d:702659. 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: MDPI Indexing Manager (email available below). General contact details of provider: https://www.mdpi.com .

    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.