Hostname: page-component-cd9895bd7-7cvxr Total loading time: 0 Render date: 2024-12-20T11:03:03.242Z Has data issue: false hasContentIssue false
  • English
  • Français

Moral Salience and the Role of Goodwill in Firm-Stakeholder Trust Repair

Published online by Cambridge University Press:  29 April 2016

Jill A. Brown ,
Ann K. Buchholtz  and
Paul Dunn
Jill A. Brown
Affiliation:
Bentley University
Ann K. Buchholtz
Affiliation:
Rutgers University
Paul Dunn
Affiliation:
Brock University
Get access Rights & Permissions [Opens in a new window]

Abstract:

Re-establishing trust presents a complex challenge for a firm after it commits corporate misconduct. We introduce a new construct, moral salience, which we define as the extent to which the firm’s behavior is morally noticeable to the stakeholder. Moral salience is a function of both the moral intensity of the firm’s behavior and the relational intensity of the firm-stakeholder psychological contract. We apply this moral salience construct to firm misconduct to develop a model of trust repair that is based on goodwill, and moderated by the firm’s stakeholder culture.

Keywords

goodwillfirm misconductmoral intensitymoral saliencepsychological contractstrust
Type
Articles
Information
Business Ethics Quarterly , Volume 26 , Issue 2 , April 2016 , pp. 181 - 199
Copyright
Copyright © Society for Business Ethics 2016 

Access options

Get access to the full version of this content by using one of the access options below. (Log in options will check for institutional or personal access. Content may require purchase if you do not have access.)

References

REFERENCES

Adler, P. S. & Kwon, S.-W. 2002. Social capital: Prospects for a new concept. Academy of Management Review, 27(1): 17–40.Google Scholar
Associated Press. 2015. Subway settles lawsuit over too-short footlongs. The Star (October 21). http://www.thestar.com/business/2015/10/21/subway-settles-lawsuit-over-too-short-footlongs.html. Accessed January 31, 2016.Google Scholar
Auger, P., & Devinney, T. M. 2007. Do what consumers say matter? The misalignment of preferences with unconstrained ethical intentions. Journal of Business Ethics, 76: 361–383.CrossRefGoogle Scholar
Baier, A. 1986. Trust and antitrust. Ethics, 96(2): 231–260.Google Scholar
Barney, J. B., & Hansen, M. H. 1994. Trustworthiness as a source of competitive advantage. Strategic Management Journal, 15(10): 175–190.Google Scholar
Baucus, M. S. 1994. Pressure, opportunity and predisposition: A multivariate model of corporate illegality. Journal of Management, 20(4): 699–721.Google Scholar
Bingham, J. B., Oldroyd, J. B., Thompson, J. A., Bednar, J. S., & Bunderson, J. S. (2013). Status and the true believer: The impact of psychological contracts on social status attributions of friendship and influence. Organization Science, 25(1): 73–92.Google Scholar
Boyle, M. 2009. The accidental hero. Bloomberg Business . http://www.bloomberg.com/bw/magazine/content/09_46/b4155058815908.htm. Accessed January 31, 2016.Google Scholar
Bundy, J., Shropshire, C., & Buchholtz, A. 2013. Strategic cognition and issue salience: Towards an explanation of firm responsiveness to stakeholder concerns. Academy of Management Review, 38(3): 352–376.Google Scholar
Burdeau, C., & Reeves, J. 2012. Gulf oil spill: Fishermen reel from seafood troubles. Huffington Post (May 24). http://www.huffingtonpost.com/2012/05/24/gulf-oil-spill-fishermen-_n_1542032.html. Accessed September 14, 2013.Google Scholar
Cohen, J. 2010. Poll shows negative ratings for BP, Federal Government. Washington Post (June 7), http://voices.washingtonpost.com/behind-the-numbers/2010/06/poll_shows_negative_ratings_fo.html. Accessed September 7, 2013.Google Scholar
Das, T. K., & Teng, B. 2001. Trust, control and risk in strategic alliances: An integrated framework. Organization Studies, 22(2): 251–283.Google Scholar
Davis, J. H., Schoorman, F. D., & Donaldson, L. 1997. Toward a stewardship theory of management. Academy of Management Review, 22(1): 20–47.Google Scholar
Dirks, K. T., & Ferrin, D. L. 2001. The role of trust in organizational settings. Organization Science, 12: 450–467.Google Scholar
Dirks, K. T., Lewicki, R. J., & Zaheer, A. 2009. Repairing relationships within and between organizations: Building a conceptual foundation. Academy of Management Review, 34(1): 68–84.Google Scholar
Dulac, T., Coyle-Shapiro, J. A.-M., Henderson, D. J., & Wayne, S. J. 2008. Not all responses to breach are the same: The interconnection of social exchange and psychological contract process in organizations. Academy of Management Review, 51(6): 1079–1098.Google Scholar
Emsley, D., & Kidon, F. 2007. The relationship between trust and control in international joint ventures. Contemporary Accounting Research, 24(3): 829–858.CrossRefGoogle Scholar
Evan, W., & Freeman, R. E. 1993. A stakeholder theory of the modern corporation: Kantian capitalism. In Donaldson, T. & Werhane, P. H. (Eds.), Ethical issues in business: 166–171. Englewood Cliffs, NJ: Prentice Hall.Google Scholar
Faber, D. B. 2005. Restoring trust after fraud: Does corporate governance matter? The Accounting Review, 80(2): 539–561.Google Scholar
Faems, D., Janssens, M., Madhok, A., & Van Looy, B. 2008, Toward an integrative perspective on alliance governance: Connecting contract design, trust dynamics, and contract application. Academy of Management Journal, 51(6): 1053–1078.CrossRefGoogle Scholar
Frooman, J. 1999. Stakeholder influence strategies. Academy of Management Review, 24(2): 191–205.CrossRefGoogle Scholar
Gillespie, N., & Dietz, G. 2009. Trust repair after an organization-level failure. Academy of Management Review, 34(1): 127–145.Google Scholar
Gillespie, N., Dietz, G., & Lockey, S. 2014. Organizational reintegration and trust repair after an integrity violation: A case study. Business Ethics Quarterly, 24(3), 371–410.Google Scholar
Godfrey, P. C. 2005. The relationship between corporate philanthropy and shareholder wealth: A risk management perspective. Academy of Management Review, 30(4): 777–798.Google Scholar
Greenwood, M. 2007. Stakeholder engagement: Beyond the myth of corporate social responsibility. Journal of Business Ethics, 74(4): 315–327.Google Scholar
Greenwood, M., & Van Buren, H. J III. 2010. Trust and stakeholder theory: Trustworthiness in the organisation-stakeholder relationship. Journal of Business Ethics, 95(3): 425–438.CrossRefGoogle Scholar
Gurchiek, K. (2010). Oil spill is personal for some SHRM members. HR Magazine, 55(8): 93.Google Scholar
Harris, J. D., & Wicks, A. C. 2010. ‘Public trust’ and trust in particular firm–stakeholder interactions. Corporate Reputation Review, 13(2): 142–154.Google Scholar
Hosmer, L. T. 1995. Trust: The connecting link between organizational theory and philosophical ethics. The Academy of Management Review, 20(2): 379–403.Google Scholar
Jones, T. M. 1991. Ethical decision making by individuals in organizations: An issue-contingent model. Academy of Management Review, 16(2): 366–395.Google Scholar
Jones, T. M., Felps, W., & Bigley, G. A. 2007. Ethical theory and stakeholder-related decisions: The role of stakeholder culture. Academy of Management Review, 32(1): 137–155.Google Scholar
Jones, T. M., & Wicks, A. C. 1999. Convergent stakeholder theory. Academy of Management Review, 24(2): 206–221.Google Scholar
Lange, D., & Washburn, N. T. (2012). Understanding attributions of corporate social irresponsibility. Academy of Management Review, 37(2): 300–326.Google Scholar
Leonard, C., & Sayre, C. 2010. For proud BP employees, an awkward new reality. USA Today.com. (May 14). http://usatoday30.usatoday.com/money/industries/energy/2010-06-20-bp-employees_N.htm. Accessed September 25, 2013.Google Scholar
Malhotra, D., & Lumineau, F. 2011. Trust and collaboration in the aftermath of conflict: The effects of contract structure. Academy of Management Journal, 54(5): 981–998.Google Scholar
Matejek, S., & Gössling, T. 2014. Beyond legitimacy: A case study in BP’s ‘Green Lashing’. Journal of Business Ethics, 120(4): 571–584.Google Scholar
Mayer, R. G., Davis, J. H., & Schoorman, F. D. 1995. An integrated model of organizational trust. Academy of Management Review, 20(3): 709–734.Google Scholar
McCarthy, D. J., & Puffer, S. M. 2008. Interpreting the ethicality of corporate governance decisions in Russia: Utilizing integrative social contracts theory to evaluate the relevance of agency theory norms. Academy of Management Review, 33(1): 11–31.Google Scholar
McElveen-Hunter, B. 2006. A letter from the Chairman of the Board of the American Red Cross, (November 1). http//www.redcross.org/www-files/Documents/Governance/BOGGovernanceReport.pdf. Accessed August 10, 2012.Google Scholar
McLean, R., & Chapple, I. 2015. BP settles final Gulf oil spill claims for $20 Billion. CNN Money. http://money.cnn.com/2015/10/06/news/companies/deepwater-horizon-bp-settlement/. Accessed February 2, 2016.Google Scholar
McLean Parks, J., & Kidder, D. L. 1994. Till death us do part…:Changing work relationships in the 1990s. In Cooper, C. L. & Rousseau, D. M. (Eds.), Trends in organisational behavior: 111–136. Chichester, NY: John Wiley.Google Scholar
Meyerson, D., Weick, K. E. & Kramer, R. M. 1996. Swift trust and temporary groups. In Kramer, R. M. & Tyler, T. R. (Eds.), Trust in organizations: Frontiers of theory and research: 166–195. Thousand Oaks, CA: Sage Publications.Google Scholar
Morrison, E., & Robinson, S. L. 1997. When employees feel betrayed: A model of how psychological contract violation develops. Academy Of Management Review, 22(1): 226–256.Google Scholar
Mouawad, J., & Krauss, C. 2010. Another torrent BP works to stem: Its CEO. The New York Times (June 4), A1.Google Scholar
Nooteboom, B. 1996. Trust, opportunism and governance: A process and control model. Organization Studies, 17: 985–1010.Google Scholar
Pfarrer, M. D., Decelles, K. A., Smith, K. G., & Taylor, M. S. 2008. After the fall: Reintegrating the corrupt organization. Academy of Management Review, 33(3): 730–749.Google Scholar
Phillips, M. J. 1995. Corporate moral responsibility: When it might matter. Business Ethics Quarterly, 5(3): 555–576.Google Scholar
Phillips, R. 2003a. Stakeholder legitimacy. Business Ethics Quarterly, 13(1): 24–41.Google Scholar
Phillips, R. 2003b. Stakeholder theory and organizational ethics. San Francisco: Berret-Koehler Publishers, Inc.Google Scholar
Pirson, M., & Malhotra, D. 2008. Unconventional insights for managing stakeholder trust. MIT Sloan Management Review, 49(4): 43–50.Google Scholar
Pirson, M., & Malhotra, D. 2011. Foundations of organizational trust: What matters to different stakeholders? Organization Science, 22(4): 1087–1104.Google Scholar
Pollack, J. M., & Bosse, D. A. 2013. When do investors forgive entrepreneurs for lying? Journal of Business Venturing, 29(6): 741–754.Google Scholar
Preston, L. E., & Post, J. E. 1995. Private management and public policy: The principle of public responsibility. Englewood Cliffs, NJ: Prentice-Hall.Google Scholar
Rhee, M., & Valdez, M. E. 2009. Contextual factors surrounding reputation damage with potential implications for reputation repair. Academy of Management Review, 34(1): 146–168.Google Scholar
Robinson, S. L. 1996. Trust and breach of the psychological contract. Administrative Science Quarterly, 41(4): 574–599.CrossRefGoogle Scholar
Robinson, S. L., & Morrison, E. W. 1995. Psychological contracts and OCB: The effect of unfulfilled obligations on civic virtue behavior. Journal of Applied Psychology, 16: 289–298.Google Scholar
Robinson, S. L., & Morrison, E. W. 2000. The development of psychological contract breach and violation: A longitudinal study. Journal of Organizational Behavior, 21: 525–546.Google Scholar
Rousseau, D. M. 1995. Psychological contracts in organizations: Understanding written and unwritten agreements. Thousand Oaks, CA: Sage.Google Scholar
Rousseau, D. M. 2011. The individual-organization relationship: The psychological contract. The APA Handbook of Industrial and Organizational Psychology, 3: 191–220.Google Scholar
Rousseau, D. M., & McLean Parks, J. 1993. The contracts of individuals and organizations. Research in Organizational Behavior, 19: 679–695.3.0.CO;2-N>CrossRefGoogle Scholar
Sartor, T. 2010. Datelines from a disaster. Pew Research Journalism Project (June 23). http://www.journalism.org/numbers/datelines-disaster/. Accessed June 26, 2014.Google Scholar
Schoorman, F. D., Mayer, R. C., & Davis, J. H. 2007. An integrative model of organizational trust: Past, present, and future. Academy of Management Review, 32(2): 344–354.Google Scholar
Scott, E. D. 2002. Organizational moral values. Business Ethics Quarterly, 12(1): 33–55.Google Scholar
Sirgy, M. J. 2002. Measuring corporate performance by building on the stakeholders model of business ethics. Journal of Business Ethics, 35(3): 143–162.Google Scholar
Smith, M. 2013. Empty nets in Louisiana three years after the spill. CNN (April 29). http://www.cnn.com/2013/04/27/us/gulf-disaster-fishing-industry. Accessed September 7, 2013.Google Scholar
Swanda, J. Jr. 1990. Goodwill, going concern, stocks and flows: A prescription for moral analysis. Journal of Business Ethics, 9(9): 751–759.Google Scholar
Thompson, J. A., & Bunderson, J. S. 2003. Violations of principle: Ideological currency in the psychological contract. Academy of Management Review, 28(4): 571–586.Google Scholar
Thrasher, M. 2013. ‘Subway Diet’ spokesman Jared is worth an absolute fortune. Business Insider (June 10). http://www.businessinsider.com/jared-fogles-subway-diet-15-years-later-2013-6. Accessed January 31, 2016.Google Scholar
Van Der Merwe, A. W., & Puth, G. 2014. Towards a conceptual model of the relationship between corporate trust and corporate reputation. Corporate Reputation Review, 17(2): 138–156.CrossRefGoogle Scholar
Vaughan, D. 1999. The dark side of organizations: Mistake, misconduct, and disaster. Annual Review of Sociology, 25: 271–305.CrossRefGoogle Scholar
Velasquez, M. G., & Rostankowski, C. 1985. Ethics theory and practice. Englewood Cliffs, NJ: Prentice-Hall.Google Scholar
Vranica, S. 2014. The secret of selling the $5 footlong. The Wall Street Journal (March 9). http://www.wsj.com/articles/SB10001424052702304558804579376781915327524. Accessed January 31, 2016.Google Scholar
Zand, D. E. 1972. Trust and managerial problem solving. Administrative Science Quarterly, 17: 229–239.Google Scholar
Zhao, H., Wayne, S. J., Clibkowski, B. C., & Bravo, J. 2007. The impact of psychological contract breach on work-related outcomes: A meta-analysis. Personnel Psychology, 60: 647–680.Google Scholar