The increasing debate on corporate ethics raises the question of whether consumers are willing to reward and punish corporate behaviour based on its ethicality. In this context, this article investigates the direct effect on consumers' willingness to pay. Price response to product-related ethical information is explored in an experiment dealing with social issues in sportswear and environmental issues in consumer electronics. It is shown that in both areas, consumers demonstrate an increased willingness to pay for ethically produced goods. However, the (...) response is subject to a negativity bias. In contrast to prior research that used abstract stimulus measures, a ratio for quantifying this bias is suggested based on consumers' willingness to pay and their price expectations. This measure allows us to analyse a consumer's individual bias. (shrink)

While most studies on stakeholder engagement focus on high-power stakeholders (typically, employees), limited attention has been devoted to the engagement of low-power stakeholders. These have been defined as vulnerable stakeholders for their low capacity to influence corporations. Our research is framed around the engagement of low-power stakeholders in the coffee industry who are, paradoxically, critical resource providers for the major roasters. Through the case study of Lavazza—the leading Italian roaster—we investigate empowerment actions addressed to smallholder farmers located in Brazil, India, (...) East Africa, Haiti, and the Dominican Republic. We contribute to the theoretical discussion around engagement and empowerment by developing a framework linking together areas of empowerment (defined in the literature) and specific empowerment actions (emerging from our interviews). Our insights shed light on how organizations can design empowerment strategies leading to more effective stakeholder engagement and how empowerment actions can contribute to turn low-power stakeholders into active business partners. We demonstrate that moving from a traditional competitive view of corporate–stakeholder relationships to a stakeholder theory view based on a logic of cooperative partnerships reinforces the idea that stakeholder engagement and empowerment are both entangled with the value creation process. (shrink)

Fair trade (FT) is of growing interest to those carrying out research into ethical decision making. In this paper, we report findings from a recent survey of FT purchasing among 688 retail shoppers in the United Kingdom. We examined the relationship between individual differences, in terms of gender and age, and three outcome measures: purchasing, word of mouth (WOM) recommendation and social advocacy. Though age appeared to have no significant effects, we found evidence of gender difference in each outcome measure. (...) Females in our sample were more likely to purchase FT goods, to recommend them by WOM, and to advocate FT purchasing to friends and family. We discuss the implications of these findings in terms of the literature on ethical decision making and gender difference. (shrink)

This paper addresses the fairness of microcredit interest rates. Since microfinance institutions provide credit for the poor at relatively high prices, the fairness of their interest rates has been repeatedly debated. We first apply Rawls' principles of justice to the case of microcredit interest rates and suggest some limitations related to the hypothesis of rationality of the borrowers and the level of inequality. We then suggest another framework based on the analysis of the distribution of the benefits generated by the (...) transaction to assess the fairness of interest rates. We conceptualize this as the distribution of the bargaining range between the borrowers' and the institutions' reservation price and discuss what these reservation prices could be in the context of microfinance. (shrink)

Fair trade (FT) is of growing interest to those carrying out research into ethical decision making. In this paper, we report findings from a recent survey of FT purchasing among 688 retail shoppers in the United Kingdom. We examined the relationship between individual differences, in terms of gender and age, and three outcome measures: purchasing, word of mouth (WOM) recommendation and social advocacy. Though age appeared to have no significant effects, we found evidence of gender difference in each outcome measure. (...) Females in our sample were more likely to purchase FT goods, to recommend them by WOM, and to advocate FT purchasing to friends and family. We discuss the implications of these findings in terms of the literature on ethical decision making and gender difference. (shrink)

The increasing debate on corporate ethics raises the question of whether consumers are willing to reward and punish corporate behaviour based on its ethicality. In this context, this article investigates the direct effect on consumers' willingness to pay. Price response to product‐related ethical information is explored in an experiment dealing with social issues in sportswear and environmental issues in consumer electronics. It is shown that in both areas, consumers demonstrate an increased willingness to pay for ethically produced goods. However, the (...) response is subject to a negativity bias. In contrast to prior research that used abstract stimulus measures, a ratio for quantifying this bias is suggested based on consumers' willingness to pay and their price expectations. This measure allows us to analyse a consumer's individual bias. (shrink)