Social Trust and Corporate Misconduct: Evidence from China

Wang Dong (), Hongling Han (), Yun Ke () and Kam C. Chan ()
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Wang Dong: Zhejiang University
Hongling Han: Zhejiang University
Yun Ke: Brock University
Kam C. Chan: Western Kentucky University

Journal of Business Ethics, 2018, vol. 151, issue 2, No 14, 539-562

Abstract: Abstract We study whether greater social trust is associated with a lower incidence of corporate misconduct. Both social norm and network theory suggest that social trust can affect managerial behavior and reduce the likelihood of misconduct behavior. Consistent with this prediction, we find that social trust is negatively associated with corporate misconduct behavior. Moreover, we show that, when media coverage is higher, the negative relation between social trust and corporate misconduct behavior is more pronounced. Further analyses suggest that social trust can help mitigate both disclosure-related and nondisclosure-related misconduct.

Keywords: Social trust; Corporate misconduct; China (search for similar items in EconPapers)
Date: 2018
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Citations: View citations in EconPapers (69)

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DOI: 10.1007/s10551-016-3234-3

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