Expecting Corporate Prosociality

Hajin Kim

The Journal of Legal Studies, 2024, vol. 53, issue 2, 267 - 296

Abstract: This paper develops and tests a theory of stakeholders’ expectations and corporate prosociality: Stakeholders taught to believe that corporations cannot and should not sacrifice profits for society will be less willing to reward and punish corporations for their societal impacts. Firms will then have less incentive to care about their social impacts. In two preregistered studies with nearly 1,300 participants, Amazon Mechanical Turk workers taught an exclusive profit-maximization norm were less likely to sign a real petition against Amazon than those taught that firms can and should care about society. Exclusive profit maximization led participants to believe that it was less appropriate and effective for employees to push for social change, that fewer firms would care, and that fewer other people would protest. Expectations of corporate prosociality—rather than of exclusive profit maximization—could thus make it easier for firms to do well by doing good.

Date: 2024
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