Social Trust and Corporate Misconduct: Evidence from China

Journal of Business Ethics 151 (2):539-562 (2018)
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Abstract

We study whether greater social trust is associated with a lower incidence of corporate misconduct. Both social norm and network theory suggest that social trust can affect managerial behavior and reduce the likelihood of misconduct behavior. Consistent with this prediction, we find that social trust is negatively associated with corporate misconduct behavior. Moreover, we show that, when media coverage is higher, the negative relation between social trust and corporate misconduct behavior is more pronounced. Further analyses suggest that social trust can help mitigate both disclosure-related and nondisclosure-related misconduct.

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Author Profiles

Dong Wang
Renmin University of China (PhD)

References found in this work

Gifts and exchanges.Kenneth J. Arrow - 1972 - Philosophy and Public Affairs 1 (4):343-362.
Financial Reports and Social Capital.Anand Jha - 2019 - Journal of Business Ethics 155 (2):567-596.
Trust and Contracting: Evidence from Church Sex Scandals.Gilles Hilary & Sterling Huang - 2021 - Journal of Business Ethics 182 (2):421-442.

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