Moral Repair examines the ethics and moral psychology of responses to wrongdoing. Explaining the emotional bonds and normative expectations that keep human beings responsive to moral standards and responsible to each other, Margaret Urban Walker uses realistic examples of both personal betrayal and political violence to analyze how moral bonds are damaged by serious wrongs and what must be done to repair the damage. Focusing on victims of wrong, their right to validation, and their sense of justice, Walker presents a (...) unified and detailed philosophical account of hope, trust, resentment, forgiveness, and making amends - the emotions and practices that sustain moral relations. Moral Repair joins a multidisciplinary literature concerned with transitional and restorative justice, reparations, and restoring individual dignity and mutual trust in the wake of serious wrongs. (shrink)

. Recent corporate scandals have focused the attention of a broad set of constituencies on reforming corporate governance. Boards of directors play a leading role in corporate governance and any significant reforms must encompass their role. To date, most reform proposals have targeted the legal, rather than the ethical obligations of directors. Legal reforms without proper attention to ethical obligations will likely prove ineffectual. The ethical role of directors is critical. Directors have overall responsibility for the ethics and compliance programs (...) of the corporation. The tone at the top that they set by example and action is central to the overall ethical environment of their firms. This role is reinforced by their legal responsibilities to provide oversight of the financial performance of the firm. Underlying this analysis is the critical assumption that ethical behavior, especially on the part of corporate leaders, leads to the best long-term interests of the corporation. We describe key components of a framework for a code of ethics for corporate boards and individual directors. The proposed code framework is based on six universal core ethical values: (1) honesty; (2) integrity; (3) loyalty; (4) responsibility; (5) fairness; and (6) citizenship. The paper concludes by suggesting critical issues that need to be dealt with in firm-based codes of ethics for directors. (shrink)

This study contributes to the work on board composition and firm corporate social responsibility by extending it to the environmental domain. It evaluates the relationship between boards of directors’ composition and environmental corporate social responsibility by integrating literatures on board composition, firm corporate social responsibility, and individual differences in attitudes toward and information about environmental issues. Using disclosed company data and the natural environment ratings data from Kinder Lydenberg Domini Inc. for 78 Fortune 1000 companies, the study finds that a (...) higher proportion of outside board directors is associated with more favorable ECSR and higher KLD strengths scores. Firms with boards composed of three or more female directors received higher KLD strengths scores. And, boards whose directors average closer to 56 years in age and those with a higher proportion of Western European directors are more likely to implement environmental governance structures or processes. Our results also reinforce growing concerns around unidimensional KLD measures. (shrink)

In this article, we examine the empirical association between corporate governance (CG) and corporate social responsibility (CSR) engagement by investigating their causal effects. Employing a large and extensive US sample, we first find that while the lag of CSR does not affect CG variables, the lag of CG variables positively affects firms’ CSR engagement, after controlling for various firm characteristics. In addition, to examine the relative importance of stakeholder theory and agency theory regarding the associations among CSR, CG, and corporate (...) financial performance (CFP), we also examine the relation between CSR and CFP. After correcting for endogeneity bias, our results show that CSR engagement positively influences CFP, supporting the conflict-resolution hypothesis based on stakeholder theory, but not the CSR overinvestment argument based on agency theory. Furthermore, firms’ CSR engagement with the community, environment, diversity, and employees plays a significantly positive role in enhancing CFP. (shrink)

In today's world, the corporate image of the largest companies is closely linked to their performance in the field of corporate social responsibility and the disclosure of information on that topic, specifically, on climate change. Since the Board of Directors is the body responsible for this process, the aim of this article is to show the role that companies' Boards of Directors play in the accountability process vis-à-vis stakeholders in relation to one specific aspect which has enormous significance in environmental (...) information: practices used to monitor greenhouse gas emissions. In order to achieve this, we shall verify certain business characteristics, in addition to the size and activity of the Board of Directors, and we shall take different dependence models into consideration. These models will include variables related to the level of independence and diversity of the Board of Directors, which interact with dummy variables representing the company's litigation risks regarding environmental behavior and the institutional macro-context of the organization's country of origin. The results make it clear that Boards of Directors are basically focused on the traditional responsibility of creating economic value, instead of dealing with today's broader business world concepts, which include social responsibility. This focus, therefore, does not favor the accountability process before other stakeholders, if this makes it more difficult to protect the interests of shareholders. (shrink)

Based on a survey of 2,361 directors in 291 of the largest companies of the Southeast States, this study empirically examined boards of directors' stakeholder orientations. The results indicate that there exist distinct stakeholder groups perceived by directors, directors have high stakeholder orientations, directors view some stakeholders differently depending on their occupation and type.

Efforts to promote corporate social and environmental accountability (SEA) should be informed by an understanding of stakeholders’ attitudes toward enhanced accountability standards. However, little is known about current attitudes on this subject, or the determinants of these attitudes. To address this issue, this study examines the relationship between personal values and support for social and environmental accountability for a sample of experienced MBA students. Exploratory factor analysis of the items comprising our measure of support for SEA revealed two distinct factors: (...) (1) endorsement of the general proposition that corporations and executives should be held accountable for the social and environmental impacts of their actions; and (2) agreement that the government should adopt and enforce formal SEA standards. Our findings indicate that the universalism value type is positively associated with general support for SEA, but not with support for government enforcement of accountability standards. In addition, we found that gender has a significant impact on support for government enforcement of SEA standards. (shrink)

A growing body of work suggests that the presence of women and of independent directors on boards of directors is associated with higher corporate environmental performance. However, the mechanisms linking board composition to corporate environmental performance are not well understood. This study proposes and empirically tests the mediating role of sustainability-themed alliances in the relationship between board composition and corporate environmental performance. Using the population of public oil and gas firms in the United States as the sample, the study relies (...) on renewable energy alliances to measure sustainability-themed alliances and longitudinally analyzes lagged data for independent and control variables. The study found that the higher the representation of women on a firm’s board, the more likely the firm is to form sustainability-themed alliances, and the higher the representation of independent directors on a firm’s board, the more likely the firm is to form sustainability-themed alliances. Such alliances, in turn, positively contribute to corporate environmental performance. This paper discusses the study’s contributions to the board composition-social performance literature. (shrink)

This study examined the relationship between the proportion of women serving on firms' boards of directors and the extent to which these same firms engaged in charitable giving activities. Using a sample of 185 Fortune 500 firms for the 1991-1994 time period, the results provide strong support for the notion that firms having a higher proportion of women serving on their boards do engage in charitable giving to a greater extent than firms having a lower proportion of women serving on (...) their boards. Further, the results suggest a link between the percentage of women on boards and firm philanthropy in the areas of community service and the arts, but found no link between women boardmembers and firm giving to support education or public policy issues. The implications of the findings and some areas for future research are discussed. (shrink)

Accumulated research findings show that women tend to express higher levels of concern toward technology and the environment than do men, but that the tendency is not universal. The findings are particularly clear-cut for local facilities and/or nuclear and other technologies that are often seen as posing nisks of contamination; findings appear to be more mixed for broader patterns of environmental concern. Although the differing patterns have been reported with enough consistency to be considered relatively robust, less progress has been (...) made to date in explaining the underlying dynamics. Five main hypotheses can be identified. One hypothesis, the expectation that increased knowledge will lead to decreased concern, has received so little support, despite repeated examination, that it can be discarded. Another, that women tend to express greater concern than do men about the health and safety implications of any given level of technological risk, has received consistent support. The remaining 3 hypotheses require additional empincal examination. (shrink)

The study empirically investigates the relationship between corporate governance and the triple bottom line sustainability performance through the lens of agency theory and stakeholder theory. We claim, in fact, that no single theory fully accounts for all the hypothesised relationships. We measure sustainability performance through manual content analysis on sustainability reports of the US-based companies. The study extends the existing literature by investigating the impact of selected corporate governance mechanisms on each dimension of sustainability performance, as defined by the GRI (...) framework. Our approach allows to identify which governance mechanisms foster triple bottom line performance, also revealing that some mechanisms fit only specific dimension of sustainability. The fact-based findings provide support for a new beginning in the theorising process in which the theories must try not only to provide rationale for the impact of corporate governance on sustainability, but also to explain which dimension of sustainability might be more affected. The most important implication for practitioners is the support for sustainability practices, which may be gained through implementation of particular corporate governance mechanisms. The findings contribute also to the improvement of the ongoing standard setting process, in particular as it concerns the in-depth revision of the economic dimension of sustainability carried out under the new GRI framework. (shrink)

This article examines the extent to which diversity characteristics and stakeholder role influence individuals’ corporate social orientation (CSO). Our findings indicate that one’s relationship to the organization as well as diversity, gender, and race influence one’s CSO. Specifically, we found that employees’ greatest concern was economic whereas customers had a stronger ethical orientation. The results also suggest that women as well as Black employees and customers place more emphasis on whether an organization is fulfilling its discretionary responsibilities than do males (...) and Whites. A model using the concept of value congruence is presented to guide future research. (shrink)

There is a distinct lack of research into the relationship between corporate governance and corporate social responsibility (CSR) in the banking sector. This paper fills the gap in the literature by examining the impact of corporate governance, with particular reference to the role of board of directors, on the quality of CSR disclosure in US listed banks’ annual reports after the US sub-prime mortgage crisis. Using a sample of large US commercial banks for the period 2009–2011 and controlling for audit (...) committee characteristics, board meeting frequency, and banks’ profitability, size and risk, we find evidence that board independence and board size, the two board characteristics usually associated with the protection of shareholder interests, are positively related to CSR disclosure. This indicates that, with regard to CSR disclosure, more independent boards of directors and larger boards are the internal corporate governance mechanisms which promote both shareholders’ and other stakeholders’ interests. Contrary to our expectations, CEO duality also impacts positively on CSR disclosure. From an agency-theoretical viewpoint, this suggests that powerful CEOs may promote transparency about banks’ CSR activities for their private benefits. While this could indicate that powerful CEOs are under particular pressure to appease stakeholders’ concerns that they might abuse their power by providing a high degree of CSR disclosure, it could also be a sign of managerial risk aversion or managers’ private reputational concerns. (shrink)

Researchers on gender and ethical decision-making have recently emphasized the differences between men's and women's ethical perceptions. This study is concerned with the perceptions of salespeople working in clothing and medical equipment sectors in Turkey. It regards the perceptions of colleagues of opposing genders in ethically questionable situations. The evaluation of salespeople's responses for 14 ethical scenarios indicates that there is no significant difference in ethical perception based on gender. Each gender predicted that their counterpart's response would be the same (...) as their own. The study also examined the effects of some demographic factors as well as the firm's sector on the salespeople's ethical perceptions and found that there are both differences and similarities in detail between genders of salespeople within ethically questionable situations. (shrink)

In this article, we examine how regulators, prosecutors, and courts might support and encourage the efforts of organizations to not only reintegrate after misconduct but also to improve their conduct in a way that reduces their likelihood of re-offense. We explore a novel experiment in creative sentencing in Alberta Canada that aimed to try to change the behaviour of an industry by publicly airing the root causes of a failure of one the industry’s leaders. Drawing on this case and prior (...) work, we articulate a model for a responsive and restorative approach to organizational misconduct that balances the punitive role of regulators and courts with new roles in supporting and overseeing rehabilitation. (shrink)

Corporations have multiple stakeholder groups. One stakeholder group consists of undergraduate business students, who collectively constitute the future leadership of corporations. Given the so-called ethical and legal lapses that have occurred in the early 2000s in such companies as Enron, WorldCom, Arthur Andersen, and Tyco, it is increasingly important to know the ethical perspectives of future business leaders so that their future behavior can be anticipated. This article reports on a survey of nearly 3,000 undergraduate business students from 58 universities (...) and colleges in 32 states regarding certain general ethics-related attitudes and the degree of ethicality these students possess. Survey findings are relatively consistent with those generally reported in the literature—female survey participants are slightly but significantly more ethically inclined than male survey participants, and survey participants who report being very religious are slightly but significantly more ethically inclined than survey participants who are less religious. (shrink)

The emergence of environmental governance practices raises a fundamental question as to whether they are substantive or symbolic. Toward that end, we analyze the relationship between a firm’s environmental governance and its environmental management as reflected in its ultimate outcome, environmental performance. We posit that substantive practices would bring changes in organizations, most notably in terms of improved environmental performance, whereas symbolic practices would portray organizations as environmentally committed without making meaningful changes to their operations. Focusing on a sample of (...) environmentally sensitive firms, results are consistent with environmental governance mechanisms being predominantly part of a symbolic approach to manage stakeholder perceptions on environmental management, having little substantial impact on organizations. Statistical analyses show mostly that there is no relation between environmental governance mechanisms and environmental performance, measured in terms of regulatory compliance, pollution prevention, and environmental capital expenditures. However, there is some indication that environmental incentives are associated with pollution prevention. Interviews with corporate directors shed further light on these results by underlining that environmental governance mechanisms are employed at the board level to protect the organization from reputational and/or regulatory harm, but are not necessarily intended to proactively improve environmental performance. (shrink)

The stock market’s reaction to information disclosure of environmental violation events (EVEs) is investigated multi-dimensionally for Chinese listed companies, including variables such as pollution types, information disclosure sources, information disclosure levels, modernization levels of the region where the company locates, ultimate ownership of the company, and ownership held by the largest shareholder. Using the method of event study, daily abnormal return (AR) and accumulative abnormal return (CAR) are calculated under different event window for examining the extent to which the stock (...) market responds to the EVEs. Furthermore, statistical significance of the difference in stock market reaction is compared between event firms with different characteristics. The relationship between CAR and its impact factors is examined by multivariate analysis. The findings reveal that the average reduction in market value is estimated to be much lower than the estimated changes in market value for similar events in other countries, demonstrating that the negative environmental events of Chinese listed companies currently have weak impact on the stock market. (shrink)

Academic debate on the strategic importance of women corporate directors is widely recognized and still open. However, most corporate boards have only one woman director or a small minority of women directors. Therefore they can still be considered as tokens. This article addresses the following question: does an increased number of women corporate boards result in a build up of critical mass that substantially contributes to firm innovation? The aim is to test if ‘at least three women’ could constitute the (...) desired critical mass by identifying different minorities of women directors (one woman, two women and at least three women). Tests are conducted on a sample of 317 Norwegian firms. The results suggest that attaining critical mass – going from one or two women (a few tokens) to at least three women (consistent minority) – makes it possible to enhance the level of firm innovation. Moreover, the results show that the relationship between the critical mass of women directors and the level of firm innovation is mediated by board strategic tasks. Implications for both theory and practice, and future research directions are discussed. (shrink)

The issue of damaged relationships and of repairing them is very important, especially in recent years with reports of organizations which damage relationships with various stakeholders. Many studies have investigated how individuals react to damaged relationships after perceiving injustice or receiving offense in organizations. A part of this research has been focused on revenge or other types of negative responses. However, individuals can choose to react in other ways than revenge, willing to repair relationships through reconciliation. Recently, the effectiveness of (...) reconciliation to repair damaged relationship in organizations has been linked to restorative justice. For the purpose of this article we are interested in understanding how restorative justice can be effective in repairing damaged or broken relationships in organizations, as inspired by principles of compassion or mercy. In this sense, we look for a convincing philosophical foundation for restorative justice, proposing Levinas’ ethics as a way to justify it. (shrink)

The under-representation of women on boards is a heavily discussed topic—not only in Germany. Based on critical mass theory and with the help of a hand-collected panel dataset of 151 listed German firms for the years 2000–2005, we explore whether the link between gender diversity and firm performance follows a U-shape. Controlling for reversed causality, we find evidence for gender diversity to at first negatively affect firm performance and—only after a “critical mass” of about 30 % women has been reached—to (...) be associated with higher firm performance than completely male boards. Given our sample firms, the critical mass of 30 % women translates into an absolute number of about three women on the board and hence supports recent studies on a corresponding “magic number” of women in the boardroom. (shrink)

One area of business performance of particular interest to both scholars and practitioners is corporate social responsibility. The notion that organizations should be attentive to the needs of constituents other than shareholders has been investigated and vigorously debated for over two decades. This has provoked an especially rich and diverse literature investigating the relationship between business and society. As a result, researchers have urged the study of the profiles and backgrounds of corporate upper echelons in order to better understand this (...) relationship.There is ample evidence that corporations have in recent years increased the proportion of outside directors on their boards. This has been partly in reaction to increased interest in the corporate social responsiveness of business organizations and suggestions that the board of directors could play a unique role in this area. The expectation on the part of practitioners, researchers, and governmental regulators is that outside directors will advocate greater corporate responsiveness to society''s needs by playing a more active role in overseeing managerial decisions. (shrink)

Managers often face situations that challenge their ability to reason morally. Avariety of factors, including the issue itself and personal and organizational influences, may affect their responses. Using Kohlberg’s moral development theory and the Adapted Moral Judgment Interviewtechnique, we examine the influences of context, age, gender, type of work, and industry membership on 308 managers’ moral reasoning. No significant differences are found when considering age or gender. Differences are discovered when assessing the context of the dilemmas, managers’ type of work (...) (managerial vs. technical), and industry membership (manufacturing vs. service). Implications from our findings are discussed. (shrink)

In the absence of effective judicial remediation mechanisms after business-related human rights violations, companies themselves are expected to establish remediation procedures for affected victims and communities. This is a challenge for both companies and victims since comprehensive company-based grievance mechanisms are currently missing. In this paper, we explore how companies can provide effective remediation after human rights violations. Accordingly, we critically assess two different approaches to conflict resolution, alternative dispute resolution and restorative justice, for their potential to provide dialogue-based, non-judicial (...) remediation. We argue that remedy through agreement-driven ADR mechanisms risks marginalizing the interests and concerns of victims and affected community members, particularly in weak institutional contexts. Hence, we develop a dialogue-driven framework for corporate remediation of human rights violations grounded on RJ principles. This restorative framework provides a comprehensive CGM that focuses on the harms and needs of victims and aims at restoring justice through restorative dialogue. Based on a prompt discovery and a thorough investigation of the grievance, companies should design and prepare the remediation process together with victims, offenders and affected community members. Through restorative dialogue with the affected parties about the circumstances and impacts of the wrongdoing, companies can repair the harm, regain legitimacy amongst stakeholders as well as transform their business practices to avoid future human rights violations. (shrink)

An important question in the business ethics literature concerns organizational response in the aftermath of an unethical business practice. This study examines factors affecting firms’ decision to take reparative action in the aftermath of an environmental violation. Specifically, we investigate environmental violators’ decision to undertake a Supplemental Environmental Project (SEP), which is an initiative that promotes restorative justice. To settle an environmental violation, the United States’ environmental regulator allows offenders the option of either paying the full penalty or a reduced (...) sum while spending additional effort and engaging in an environmental project. As predicted, we find that firms with poorer past environmental performance and greater shareholder environmental activism are more likely to engage and invest in a SEP. Additionally, there is a stronger association between shareholder activism and SEP investment when firms have poorer past environmental performance. Our findings inform regulators, stakeholders, and business ethics researchers on the factors that lead firms to undertake reparative action following unethical business practices. (shrink)

ABSTRACT:In this article, we examine how regulators, prosecutors, and courts might support and encourage the efforts of organizations to not only reintegrate after misconduct but also to improve their conduct in a way that reduces their likelihood of re-offense (rehabilitation). We explore a novel experiment in creative sentencing in Alberta Canada that aimed to try to change the behaviour of an industry by publicly airing the root causes of a failure of one the industry’s leaders. Drawing on this case and (...) prior work, we articulate a model for a responsive and restorative approach to organizational misconduct that balances the punitive role of regulators and courts with new roles in supporting and overseeing rehabilitation. (shrink)

This study examines the effect of gender, Machiavellian orientation, and socially desirable reporting on the respondent’s orientation toward corporate social responsibility. A sample of 219 undergraduate students from a Midwestern university exhibited differences in orientation across gender and degree of Machiavellian orientation. Social desirability had a minimal effect on the responses.

Since manager's decisions impact organizational goals and organizational ethical behavior, this researcher investigated the degree to which there are differences in the moral reasoning ability of business managers of selected industries and whether there are significant differences between top, middle, and first-line management levels. To determine the relationship between managers' locus of control and their moral reasoning ability, this study considered three independent variables: reported organizational ethical climate, locus of control, and selected demographic and institutional variables. For a foundation, this (...) researcher relied on Kohlberg's theory of moral development, Victor and Cullen's ethical work climate theory, and Rotter's theory of internal—external locus of control (which evolved from Carl Jung). The short form of Rest's DIT instrument measured the moral reasoning abilities of the participants. The selected demographic and institutional variables (age, work tenure, education, gender, management level and industry category) provided the useful information to investigate these relationships of moral reasoning ability of individual managers. A survey questionnaire was sent to 400 managerial and executive level employees at a random sample of Fortune 500 firms throughout the United States: Dun and Bradstreet provided the researcher with a proportional stratified random sample of these 400 managerial and executive level employees at a variety of organizations. Interestingly, women in this study exhibited slightly higher (more external) mean I—E scores and (more principled) higher mean “P” score than men. While both of these results were anticipated, neither was significant. However, one major finding of this study was the statistically significant relationship between age and perceived organizational ethical climate types (Caring, Law and Code, Rule, Instrument, and Independence). Another major finding revealed a statistically significant relationship between management levels and organizational ethical climate. (shrink)