How do corporate social responsibility (CSR) disclosure and innovation investment co-evolve with organizational forms to affect firm market value? To address this question, we draw on the co-evolutionary perspective and theorize that the contingency effect of CSR reporting is more pronounced for firms with high uncertainty and low legitimacy by comparing start-up firms vs. established firms and privately owned enterprises (POEs) versus state-owned enterprises (SOEs). Moreover, taking a dynamic approach, we propose that the effects of CSR and innovation investment on (...) market value change when the organizational form transitions over time. Specifically, we argue that when start-up firms transitioned to established firms or when POEs were transformed from SOEs, the strengthening effects of CSR reporting become less pronounced. We test our theory using panel data on 2204 Chinese listed firms for the period of 2008–2017. (shrink)

While directors’ task boundaries are usually ambiguous, some of their activities or behaviors clearly constitute their formal duties, whereas others are usually perceived as organizational citizenship behavior. Applying identity theory, we present a theoretical model that demonstrates one of the key drivers for directors to engage in OCB with a focus on their role identity. We argue that an individual director’s role identity is one of the key factors that motivate directors to engage in OCB. Furthermore, we propose that two (...) board-level contingencies, board capital, and informal board hierarchy order, can moderate the effect of directors’ role-identity salience on their OCB. That is, low levels of board capital and directors’ higher positions in a board’s informal hierarchy enhance directors’ motivation to engage in OCB. (shrink)

Corporate financial misconduct has garnered increased interest in business ethics research. Although prior research has provided insights into the consequences of financial misconduct, our understanding of why investors react differently to similar instances of misconduct, especially in emerging markets, remains limited. In this study, we first argue that direct information on the severity of misconduct is the primary basis for investors’ evaluations. Next, drawing on screening theory, we theorize that in contexts characterized by high information asymmetry, indirect information about existing (...) firm commitment cues plays a vital screening role by demonstrating the firm’s legitimacy and capability. Subsequently, we develop a tripod framework that integrates the social, market, and strategy dimensions as firm commitment cues that serve as fundamental screening mechanisms to mitigate the adverse effect of misconduct severity on investor reactions. We use a sample of 344 Chinese listed firms that engaged in financial misconduct during 2009–2019 and find that greater misconduct severity results in more negative investor reactions. However, this negative relationship is weakened when the firm demonstrates stronger social and strategy commitments but not stronger market commitment. (shrink)