Business Ethics: A European Review, EarlyView.

Our paper contributes to emerging management research on the effects of societal inequality. It aims to study the relationship between societal-level inequality and perceived unequal HR practices within organizations based on relationships which we term “relation-based inequality” (RBI). We further examine the moderating effect of country corruption on the RBI-employee commitment link. Thus, whereas previous research has looked at single countries, there is still much to know about societal effects of inequality and corruption on employee perceptions and attitudes at work (...) across countries. By surveying 691employees from five countries and using country-level indicators we take a first step in this direction, and establish that inequality (income, health and education) is linked to higher levels of relation-based HR practices. We also show that the effect of RBI is different for continuance, affective and normative commitment, and contingent on country corruption levels. (shrink)

AbstractBoardroom backscratching, or cronyism, is an unethical practice where CEOs conspire with directors to receive remuneration beyond performance- and market-related factors. Premised on the theory of planned behavior, this study investigates whether CEO generalist experience magnifies the likelihood of boardroom backscratching. Using 9482 firm-year observations spanning 1999–2018, our analysis shows that firms with greater CEO generalist managerial experience are more likely to engage in boardroom backscratching, via both cash- and equity-based compensation. We provide further evidence that backscratching firms with CEOs (...) that possess greater generalist experience tend to overinvest, particularly via non-capital expenditure, as a channel for empire building and private rent extraction. We also find that a higher portion of female independent directors sitting on the board and the compensation committee mitigates the positive relationship between CEO generalist managerial experience and boardroom backscratching, which we attribute to greater ethicality of, and increased monitoring exercised by, female independent directors. (shrink)

The current research examines the possible outcomes of cronyism like organizational deviance, organizational cynicism, and counterproductive work behavior and also investigates the mediating variable violation of psychological contract among cronyism and its possible outcomes. Many studies have investigated the presence of organizational cronyism at the workplace and its impacts on certain variables. However, the outcomes observed in this study, i.e., OD, OCy, and counter-productive work behavior were not empirically investigated previously as per researchers’ knowledge. The second gap this study fills (...) is the mediating effect of VPC between the studied variables. Thirdly, the study was conducted in Azad Jammu and Kashmir, Pakistan, which is almost the first attempt to investigate this phenomenon in Azad Jammu and Kashmir. Data were collected from the employees working under different ministries of Azad Jammu and Kashmir, Pakistan like education, forest, sports, information, local government, finance, and tourism. The data from 350 employees were collected through convenience sampling. The data collection process was conducted at two distinct time lags. Results show that OC significantly and positively relates with OD, OCy, and counter-productive work behavior, whereas VPC mediates the relationship among OC and OD, OC, and counter-productive work behavior. Employees enjoying special favors from the leadership seem to be more dedicated toward the organization than the employees who do not have this favor, and the ultimate result is negative for the organization. (shrink)