 Too bad to fear, too good to dare? Performance feedback and corporate misconductYongqiang Gao, Haibin Yang and Miaohan Zhang Journal of Business Research, 2021, vol. 131, issue C, 1-11 Abstract: This study explores how a firm’s performance feedback (relative to its aspirations) may influence its likelihood of involvement in misconduct. We propose and test curvilinear relationships between aspired performance and corporate misconduct by drawing upon the behavioral theory of the firm. We argue that a U-shaped relationship may exist between aspired performance and corporate misconduct when performance feedback is positive (i.e., performance is above aspirations), in that high performance firstly decreases and then increases the likelihood of misconduct. On the contrary, we propose an inverse U-shaped relationship between aspired performance and corporate misconduct when performance feedback is negative (i.e., performance is below aspirations), in that low performance firstly increases and then decreases the likelihood of misconduct. Evidence from Chinese publicly-listed manufacturers largely supports our predictions. Keywords: Corporate misconduct; Performance feedback; Behavioral theory of the firm; Risk preference (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:jbrese:v:131:y:2021:i:c:p:1-11 DOI: 10.1016/j.jbusres.2021.03.041 Access Statistics for this article Journal of Business Research is currently edited by A. G. Woodside More articles in Journal of Business Research from Elsevier |
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