Why do some organizations suffer more than others in the wake of an industry scandal? Although ex-ante greater opportunistic behavior of organizations is one factor, we argue that ex-post greater targeting of organizations is another important factor. Using the context of microfinance organizations (MFOs), we examine why the financial sustainability of for-profit and non-profit organizations may be heterogeneously affected following a scandal. Leveraging the 2010 Indian microfinance scandal as our research setting and analyzing longitudinal data, we find a substantial decline (...) in the financial sustainability of Indian MFOs relative to their counterparts within the rest of South Asia. Compared to Indian non-profit MFOs, Indian for-profit MFOs suffered substantially more. Intriguingly, these results hold not only in the full sample, but also in the matched sample of comparable for-profit and non-profit MFOs. Further analysis reveals that the adverse impact on for-profit MFOs was much bigger in the scandal’s epicenter. Our findings suggest that some organizations may suffer more than others not only due to their engagement in actual malfeasance but also due to their greater targeting by the social control agents. We discuss the implications of this study for social enterprise managers and policymakers. (shrink)

Based on China’s mandatory requirement for listed firms to implement online voting in their annual general shareholder meetings, we investigate whether and how minority shareholders influence corporate environmental performance (CEP). We use the difference-in-difference approach and find that the implementation of online voting promotes minority shareholders’ participation in shareholder meetings, which, in turn, leads to improved CEP of listed firms. We discover that “local pollution” exposure and “the increasing awareness of listed firms’ environmental risks” are the main motives of minority (...) shareholders concerning listed firms’ environmental performance. Furthermore, we find that the minority shareholders improve CEP of listed firms through influencing groups with greater bargaining power. (shrink)