A compelling exploration of how reputation affects every aspect of contemporary life Reputation touches almost everything, guiding our behavior and choices in countless ways. But it is also shrouded in mystery. Why is it so powerful when the criteria by which people and things are defined as good or bad often appear to be arbitrary? Why do we care so much about how others see us that we may even do irrational and harmful things to try to influence (...) their opinion? In this engaging book, Gloria Origgi draws on philosophy, social psychology, sociology, economics, literature, and history to offer an illuminating account of an important yet oddly neglected subject. Origgi examines the influence of the Internet and social media, as well as the countless ranking systems that characterize modern society and contribute to the creation of formal and informal reputations in our social relations, in business, in politics, in academia, and even in wine. She highlights the importance of reputation to the effective functioning of the economy and e-commerce. Origgi also discusses the existential significance of our obsession with reputation, concluding that an awareness of the relationship between our reputation and our actions empowers us to better understand who we are and why we do what we do. Compellingly written and filled with surprising insights, Reputation pins down an elusive subject that affects everyone. (shrink)

Cheating is a major problem in society, especially in the educational system. From the viewpoint of subjective cost-benefit analysis, concerns about reputation damage as well as considerations of cultural values against unethical behavior can help increase the perceived costs of cheating. To explore deeper into the psychological processes in such assessments, we employ Bayesian Mindsponge Framework (BMF) analytics – an information-processingbased method. Conducting Bayesian analysis on 493 university students from Germany, Vietnam, China, Taiwan, and Japan, we found that (...) class='Hi'>reputation concern is negatively associated with cheating behavior. If a student embraces Confucian values, the above negating effect is stronger. Our findings support the notion that mentally simulated negative consequences of cheating reduce the probability of carrying out such behavior. As the educational system is changing rapidly due to technological advancement, a better understanding of the influences of sociocultural factors can be helpful in cheating prevention efforts. (shrink)

This paper analyzes the determinants of corporate reputation within a sample of large UK companies drawn from a diverse range of industries. We pay particular attention to the role that philanthropic expenditures and policies may play in shaping the perceptions of companies among their stakeholders. Our findings highlight that companies which make higher levels of philanthropic expenditures have better reputations and that this effect varies significantly across industries. Given that reputational indices tend to reflect the financial performance of organizations (...) above other factors (Fryxell, G. E. and J. Wang: 1994, Journal of Management 20, 1–14) and that elements of the literature emphasise that discretionary aspects of social responsibility, including corporate donations, may not be in the financial interests of organizations (e.g. Friedman, M.: 1970, “The Social Responsibility of Business is to Increase its Profits”, New York Times Magazine, September 13), this is a significant finding. It suggests that philanthropic expenditures may play a significant role in stakeholder management and may, in particular, lead to stakeholders holding more positive impressions of philanthropic corporations. (shrink)

Assumed benefits from improved reputation are often used as motives to drive corporate social responsibility (CSR) initiatives. Are improved cost efficiencies among these reputation benefits? Cost efficiencies and cost management have become more relevant as revenue streams dry up in these tough economic times. Can a good reputation aid these efforts to develop cost efficiencies specifically when managing labor costs? Prior research hypothesizes that good reputation can create labor productivity and efficiency benefits. The purpose of this (...) study is to empirically investigate reputation's relationship with labor efficiency, labor productivity, and labor cost. Using a sample of highly reputable firms from Fortune's America's Most Admired Companies list and a corresponding matched sample of firms, we find that reputation is associated with improved labor efficiency and labor productivity. However, we do not find a significant association between reputation and reduced labor costs. Our study contributes to current research hypothesizing and finding efficiency benefits associated with good reputation. Documenting these potential reputation benefits has important implications for CSR activities and initiatives. It supports recent work that incorporates reputation into a more developed model of the relationship between CSR and performance (Vilanova et al.: 2009, Journal of Business Ethics 87, 57-69). This work is useful to businesses and supports strategies focused on "doing well by doing good" and maintaining healthy reputations. (shrink)

From an evolutionary point of view, the function of moral behaviour may be to secure a good reputation as a co-operator. The best way to do so may be to obey genuine moral motivations. Still, one's moral reputation maybe something too important to be entrusted just to one's moral sense. A robust concern for one's reputation is likely to have evolved too. Here we explore some of the complex relationships between morality and reputation both from an (...) evolutionary and a cognitive point of view. (shrink)

Drawing upon rational choice and investor attention theories, we examine how accusations of corporate bribery and subsequent investigations shape market reactions. Using event study methodology to measure loss in firm value for public firms facing bribery investigations from 1978 to 2010, we found that total market penalties amounted to $60.61 billion. We ran moderated multiple regression analysis to examine further the degree to which the unique characteristics of bribery explain variations in market penalties. Companies committing bribery in less corrupt host (...) countries and with the involvement of compromised executives experienced greater market penalties than did other companies. After partitioning share value losses into components for regulatory penalties, class action settlements, and loss to reputation, we found that reputational penalties account for 81.8¢ of every dollar of share value loss. Omission of reputational penalties in rational choice calculus underestimates bribery costs by 4.5 times. The results suggest that firms should not underestimate the importance of market-imposed reputational penalties by merely considering regulator-imposed fines and sanctions. (shrink)

This paper describes an exploratory study of corporate responsibility, corporate reputation, and stakeholder support in Norway, Sweden and Denmark—countries recognized worldwide as providing an institutional climate uniquely conducive to responsible business practice. Conducting a secondary analysis of Scandinavian data from Reputation Institute’s extensive global research on corporate reputation and responsibility, we examine four key questions: First, do Scandinavians agree with external observers that firms in their countries demonstrate superior levels of corporate responsibility? Second, relative to other (...) class='Hi'>reputation drivers, to what extent does corporate responsibility predict corporate reputation for the countries in our dataset? Third, to what extent does corporate responsibility predict stakeholder intent in these countries to engage in supportive behavior toward the firm? Finally, are stakeholder perceptions of and responses to corporate responsibility sufficiently similar across Norway, Sweden, and Denmark to justify claims for a monolithic “Scandinavian approach” to CSR? Previous research examining the relationship of corporate responsibility to corporate reputation and stakeholder support is reviewed, analytical methods are described, results presented, and implications discussed. The article concludes with analysis of study limitations and directions for future research. (shrink)

The authors describe the intensity and orientation of the corporate social responsibility reporting in four Spanish industries and explore the relationship that exists between both concepts and an independent measurement of reputation for CSR. The results demonstrate that the CSR reporting is especially relevant and useful in the finance industry. Finance companies report significantly more CSR information than most industries in Spain, and this reporting is more closely linked to their CSRR than the CSR reporting of basic, consumer goods (...) and services industries. (shrink)

Management scholars have paid close attention to the construct of organizational or corporate reputation, particularly in the applied business ethics and corporate social responsibility fields. Extant research demonstrates that CR is one of the key mediators between CSR and important organizational outcomes, which ultimately improve organizational performance. Yet, hitherto the research focused on CR construct has been plagued by multiple definitions, conflicting conceptualizations, and unclear operationalizations. The purpose of this article is to provide theoretical ground for positioning of CR (...) as an assessment construct that is modeled as a second-order factor affecting individual first-order dimensions, and to provide methodological and empirical support toward such conceptualization. We assert that intangible, socially complex, and causally ambiguous CR can be accurately estimated through its individual measurable dimensions. Using survey data from Peru, we empirically test the hypothesized second-order reflective model within a hierarchy of nested and non-nested models, and compare its model fit and predictive power with alternative conceptualizations. Modeling CR as a second-order reflective construct relies on a set of theoretical propositions and yields several methodological advantages, including strong conceptual interpretability and parsimony when tested within a nomological context. We explicitly demonstrate positive organizational outcomes of CR: customer trust, corporate identification, in-role behavior, and extra-role behavior. Then, we demonstrate that the shorter scales of CR can be used as a good proxy for the full construct measure. The paper concludes by highlighting theoretical insights, and methodological and managerial implications of the findings. (shrink)

Previous experimental and observational work suggests that people act more generously when they are observed and observe others in social settings. However, the explanation for this is unclear. An individual may want to send a signal of her generosity to improve her own reputation. Alternately (or additionally) she may value the public good or charity itself and, believing that contribution levels are strategic complements, give more to influence others to give more. We perform the first series of laboratory experiments (...) that can separately estimate the impact of these two social effects, and test whether realized influence is consistent with the desire to influence, and whether either of these are consistent with anticipated influence. Our experimental subjects were given the opportunity to contribute from their endowment to Bread for the World, a development NGO. Depending on treatment, “leader” subjects’ donations were reported to other subjects either anonymously or with their identities, and these were reported either before these “follower” subjects made their donation decisions. We find that “leaders” are influential only when their identities are revealed along with their donations, and female leaders are more influential than males. Identified leaders’ predictions suggest that are aware of their influence. They respond to this by giving more than either the control group or the unidentified leaders. We find mixed evidence for “reputation-seeking.”. (shrink)

This paper explores the relationship between accountability, trust and corporate reputation building. Increasing numbers of corporations are mobilising themselves to put more and more information out into the public domain as a way of communicating with stakeholders. Corporate social accounting and stakeholder engagement is happening on an unprecedented scale. Rather than welcoming such initiatives, academics have been quick to pick faults with contemporary social auditing and reporting, claiming that in its current form it is not about demonstrating accountability at (...) all, but rather about building corporate reputation. Academics argue that ‘accountability should hurt’, that if accountability is an enjoyable process, then the organisation isn’t doing it right. For organisations that are currently engaging with stakeholders and ostensibly becoming more transparent about their corporate social performance, this kind of critique is likely to be bewildering. This paper argues that central to the notion of accountability and to contemporary social accounting practice is the concept of trust. Accountability is based upon a distrust of corporate management, whereas corporate reputation building is about strategically seeking to establish trust in stakeholder relationships in order to negate formal accountability requirements. Using a split trust continuum, the paper seeks to explain and synthesise what seem to be two very different paradigms of organisational transparency. (shrink)

Many countries have regulations that require firms to engage in minimum levels of corporate social activities in areas such as the environment and social welfare. In this paper, we argue that changes in a firm’s compliance with CS regulations are reflected in its reputation for corporate social responsibility, which affects the firm’s performance. The performance impacts depend on whether the firm’s CSR reputation in the current and prior periods is positive, neutral, or negative. Our theoretical framework draws on (...) the reputation literature and on the concepts of recency bias, which weights the present more heavily than the past, and negativity bias, which weights negative assessments more heavily than neutral or positive assessments. We test our hypotheses on a sample of 7317 banks over 1992–2007 where we compare a bank’s return on assets with its current and prior compliance ratings under the U.S. Community Reinvestment Act. We find that changes in CSR reputation have predictable, asymmetric, and sizeable impacts on firm performance. For example, for an average bank with $1 billion in assets, gaining a positive CSR reputation translates into a rise in profits of 4.04%; gaining a negative CSR reputation results in a drop in profits of − 7.8%. (shrink)

This paper explores the relationship between accountability, trust and corporate reputation building. Increasing numbers of corporations are mobilising themselves to put more and more information out into the public domain as a way of communicating with stakeholders. Corporate social accounting and stakeholder engagement is happening on an unprecedented scale. Rather than welcoming such initiatives, academics have been quick to pick faults with contemporary social auditing and reporting, claiming that in its current form it is not about demonstrating accountability at (...) all, but rather about building corporate reputation. Academics argue that ‘accountability should hurt’, that if accountability is an enjoyable process, then the organisation isn’t doing it right. For organisations that are currently engaging with stakeholders and ostensibly becoming more transparent about their corporate social performance, this kind of critique is likely to be bewildering. This paper argues that central to the notion of accountability and to contemporary social accounting practice is the concept of trust. Accountability is based upon a distrust of corporate management, whereas corporate reputation building is about strategically seeking to establish trust in stakeholder relationships in order to negate formal accountability requirements. Using a split trust continuum, the paper seeks to explain and synthesise what seem to be two very different paradigms of organisational transparency. (shrink)

From an evolutionary point of view, the function of moral behaviour may be to secure a good reputation as a co‐operator. The best way to do so may be to obey genuine moral motivations. Still, one's moral reputation maybe something too important to be entrusted just to one's moral sense. A robust concern for one's reputation is likely to have evolved too. Here we explore some of the complex relationships between morality and reputation both from an (...) evolutionary and a cognitive point of view. (shrink)

Given the food challenges that society is facing, we draw upon recent developments in the study of how food reputation affects food preferences and food choices, providing here a starting standard point for measuring every aspect of food reputation in different cultural contexts across the world. Specifically, while previous attempts focused either on specific aspects of food or on measures of food features validated in one language only, the present research validates the Food Reputation Map (FRM) in (...) Italian, English and Chinese over 2250 participants worldwide. Here we successfully measure food reputation across twenty-three specific indicators, further grouped into six synthetic indicators of food reputation. Critically, results show that: a) the specific measurement tool of food reputation can vary across cultural contexts, and that b) people’s reputation of food products or categories changes significantly across different cultural contexts. Therefore, in order to understand people’s food preferences and consumption, it is important to take into account the repertoire of cultural differences that underlies the contexts of analysis: the three context-specific versions of the FRM presented here effectively deal with this issue and provide reliable context-specific insights on stakeholders’ interests, perspectives, attitudes and behaviors related to food perceptions, assessment and consumption, which can be effectively leveraged to foster food sustainability. (shrink)

We analyze whether audit partners suffered damage to their professional reputations with the demise of Zhongtianqin, formerly the largest audit firm in China, after an audit failure enabled a major client, Yinguangxia, to fraudulently exaggerate its earnings in a high-profile scandal resembling the Andersen–Enron events in the US. This involves evaluating whether the reputational damage sustained by partners implicated in the scandal spreads to other partners in the same audit firm. We isolate whether impaired reputation impedes partners who were (...) not complicit in the ZTQ–YGX events from attracting new clients or keeping existing ones. Our evidence implies that the market shares of these partners fell after ZTQ’s collapse, supporting that guiltless partners’ reputations were tarnished. We also find that these partners are less likely to be employed by reputable audit firms. The clients of these partners tend to have lower earnings response coefficients, implying that investors downgrade the perceived quality of their audits. Moreover, compared to a matched sample, the former ZTQ partners tend to charge lower audit fees after the firm’s collapse. Finally, we exploit the unique structure of ZTQ to provide evidence consistent with the prediction that the former partners from the branch that handled the YGX audits experienced worse damage to their reputations. In a setting with minimal auditor discipline stemming from civil litigation, our results lend support to the intuition that partners’ reputation concerns motivate them to protect audit quality by closely monitoring other partners in the firm. (shrink)

Banking scandals, accounting fraud, product recalls, and environmental disasters, their associated reputational effects as well as company response strategies have been well reported in the literature. Reported crises and scandals typically involve one focal company for example BP and the 2010 Deepwater Horizon accident. As business practices change and company supply chains become more complex and interlinked, there is a greater risk of collective crises where multiple companies are associated with the same scandal. We argue that companies are likely to (...) behave differently in a group setting compared to when faced with a crisis individually. Using an inductive approach, we examine the case of the Rana Plaza building collapse. We find that organizations with a history of similar crises adopt defensive strategies and communicate much later compared to organizations which adopt accommodative strategies. Contrary to the individual case, in a collective crisis accommodative strategies result in more negative reputational damage and a higher burden of responsibility. We propose that the relationship between crisis response strategy and organization reputation is moderated by the crisis setting. We extend the logic of crisis management and corporate reputation to incorporate the case of a collective crisis. (shrink)

Unlike the supergame model assumes agents in exchange situations will normally not be perfectly informed on past behaviour of their partners. Also, they will be able to choose their partners to a certain extend. A formal model is presented that attempts to take account of these facts. It is supposed that for any actor the probability of finding a partner for a lucrative exchange depends on his past behaviour. A model of reputation formation is presented as a formal description (...) of this interdependency. Based on this model it is shown that under certain conditions only co-operative conduct will pay in the long run. Thus it is confirmed that - given the mechanism of trust - rational agents may act trustworthy. (shrink)

Much work on intellectual humility has focused on its epistemic benefits. We suggest that displaying (or failing to display) intellectual humility also has effects on how others perceive us and that, as a result, intellectual humility can serve reputation management purposes, in at least four ways: (i) Intellectual humility can be used to signal we are a good source of information; (ii) Intellectual humility can be used to signal we are competent through countersignaling; (iii) Intellectual humility can be used (...) to make sure others do not believe we are overclaiming superiority; (iv) lack of intellectual humility (or intellectual arrogance) can be used to signal dominance. The evidence suggests that intellectual humility (or lack thereof) can have each of these effects. Seeing intellectual humility as (inter alia) a reputation management tool predicts that people will be more or less likely to display intellectual humility in some contexts. For instance, people in a position of power might stand to lose less if they fail to be intellectual humble; accordingly, evidence suggests that they tend to display less intellectual humility. In conclusion, we speculate that understanding intellectual humility as reputation management could help construct environments more conducive to displays of intellectual humility. (shrink)

Reputation is a commercially valuable asset. This book focuses upon how enhanced reputation can contribute to commercial asset management through increased share price premium and competitive performance, while reputation loss can significantly erode the ability of the business to successfully retain market share, maximize shareholder value, raise finance, manage debt, and remain independent. It provides practical models and checklists designed to plan reputation management and risk communication strategies.

This paper examines the association between board characteristics and the ethical reputation of financial institutions. Given the pivotal governance role of the board of directors and the value-relevance of ethical corporate behavior, we postulate a positive relationship between ethical reputation and board features that foster more effective monitoring and oversight. Using a sample of large financial institutions from 13 different countries, we run several alternative panel regressions of ethical reputation on board characteristics and firm-specific controls. Our results (...) demonstrate that the ethical reputation of financial institutions is positively associated with board size, gender diversity, and CEO duality, while being negatively related to the busyness of the board members and a composite index reflecting poor monitoring. Nevertheless, inconsistent with our hypothesis, we also document that financial institutions with less frequent board meetings have better ethical reputation. Overall, our empirical findings suggest that stronger board oversight may promote ethical behavior in the financial industry. (shrink)

This article introduces the special issue on “Corporate Reputation: Being Good and Looking Good.” Three of the five included articles help to reinforce a conclusion that “being good” and “looking good” are not dichotomous, mutually exclusive conditions. Rather, the two dimensions are linked in some kind of causal relationship for which continuing conceptual and empirical research is desirable. A fourth article concerns the reputational effects of the stock-option backdating scandal. The fifth article offers a critique of conventional approaches to (...) defining and measuring reputation. (shrink)

Ethical or ‘socially sustainable’ sourcing mechanisms mandating labour standards among the suppliers and subcontractors that organisations source goods and services from are becoming more common. The issue of how labour activist groups such as trade unions can encourage organisations to adopt and strengthen these mechanisms within domestic production networks is largely unexplored. Using three cases of domestic sustainable sourcing campaigns developed by unions in Britain, the strategies used by labour activists, the characteristics of the organisations targeted and the motivations of (...) lead firms for improving sourcing practices are analysed. The article makes a significant contribution by demonstrating that organisational susceptibility to reputational risk is a key factor influencing the capacity of activist groups to convince and compel their targets to improve sourcing practices. It argues that different types of organisations are susceptible to reputational damage in different ways, that risk events provide opportunities for unions to strengthen their leverage against target organisations, and that the multidimensional nature of corporate reputation needs to be better considered for understanding how campaigns are framed and executed. (shrink)

Limited air strikes present an attractive “middle-ground approach” for policymakers, as they are less costly to coercers than deploying troops on the ground. Policymakers believe that threatening and employing limited air strikes signal their resolve to targets. In this essay, as part of the roundtable on “The Ethics of Limited Strikes,” I debunk this fallacy and explain how the same factors that make limited air strikes attractive to coercers are also those that undermine their efficacy as a coercive tool of (...) foreign policy. The limited nature of these air strikes undermines the ability of coercers to effectively signal their resolve. In turn, coercive threats of limited air strikes are less likely to be credible, creating a vicious cycle: policymakers threaten to employ air strikes because they are less costly but then often need to follow through on those threats as target states fail to acquiesce to their demands, precisely because limited air strikes are less costly for the coercer. Limited air strikes, therefore, can actually be a source of conflict escalation and lead policymakers to engage in military action that they would prefer to avoid. I further explain why failing to follow through on such coercive threats can undermine a leader's reputation for resolve and lead to future crisis escalation. Finally, I discuss what this quagmire means for the ethics of the threat and the use of air strikes, particularly for the principles of right intention, likelihood of success, and probability of escalation. (shrink)

Reputation detection in traditional distributed systems relies heavily on the factor of interaction reputation, which can be derived from direct interactions between agents through bidirectional relationships. However, in the current information diffusion in social network systems, the characteristic of the unidirectional relationship between agents and the decay property of diffusion will result in lacking direct interactions; therefore, interaction reputations will be difficult to be obtained by agents in a distributed manner. To solve this problem, a novel distributed (...) class='Hi'>reputation detection model following the pattern “from path to individual” is proposed, which can provide a new reputation factor as an alternative to interaction reputation in such environments. The main idea is that the positive observation of an information diffusion process increases the belief of the corresponding diffusion path, which further increases the reputation of each involved agent. Thus, the reputation of a target agent can be assessed by the superimposition of reputations of multiple paths on which this agent has participated in past information diffusion processes. Furthermore, being aware of agent’s limited capacity for reputation detection in SNS, we then propose the enhanced FPTI model, which simplifies the detection source to reduce detection costs and achieve the approximate performance as FPTI. Theoretical analyses and experimental evaluations validate the efficiency and effectiveness of our models and also show several properties of the models, for example, the robustness for dynamic environments. (shrink)

This paper examines how and why information moved or failed to move within transatlantic botanical networks in the late eighteenth century. It addresses the problem of how practitioners created relationships of trust, and the difficulties they faced in transferring reputations between national contexts. Eighteenth-century botany was characteristically cross-cultural, cosmopolitan and socially diverse, yet in the 1770s and 1780s the American Revolutionary Wars placed these attributes under strain. The paper analyses the British and French networks that surrounded the Philadelphian plant hunter (...) William Young, to show how botanists and plant collectors created and maintained connections with each other, especially when separated by geographical and cultural distance. It highlights in particular the role played by commercial plant traders, and demonstrates how practitioners used objects to transmit social as well as scholarly information. The transnational circulation of information and knowledge in the Enlightenment was determined by culturally specific judgements about trust, confidence, communication and risk. Despite the prominent role played by material culture within these networks, scholars continued to place high value on face-to-face contact as a means of judging the trustworthiness and cooperation of their agents. (shrink)

The concept of reputation has hardly been analyzed by philosophers. My analysis presents a puzzle: reputation is a portrayal of who one is. However, it is dependent on others. This description contradicts David Oderberg’s analogy between reputation and property. I discuss the relation of reputation to gossip and conclude that we should take spreading information seriously. We should go back to the original meaning of gossip: the term “Godsib,” meaning godfather. In our global village we are (...) all entrusted with other’s identities. We should pave our way with that information in a manner that would manifest great care. But this does not mean that these people are exempt from responsibility: the chain that ends in reputation starts with how you behave. It is your very identity that you entrust to other people—make sure to behave in a way that would result in the reputation you want to deserve. (shrink)

The current study is designed to propose and test a model about the ethical reputation of a target manager who must decide whether to engage in earnings management. We employ an experimental approach to examine the potential negative reputation effects within the internal labor market of a firm that occur as a consequence of earnings management. We examine participants’ responses to a hypothetical (target) manager when both the target’s behavior and the corporate incentives were manipulated. Participants assessed how (...) ethical they believed a target manager to be, based on the target’s decision regarding earnings management and the nature of the corporate incentives. Participants also assessed the target’s managerial ability. Participants’ judgments regarding the target’s morality were significantly affected by the target’s behavior, but were not affected by the incentive structure. Ability judgments were significantly and positively related with morality assessments. Further analysis indicates that morality assessments mediate the relationships between the target’s behavior and the participants’ willingness to extend work-related opportunities to the target. Implications of these results for management control systems design and for future research are discussed. (shrink)

This chapter analyzes the philosophical import of the notion of reputation along two main axes: (1) reputation as a motivation for action, and (2) reputation as a special kind of social information. Is reputation a rational motive of action? Can it be an ultimate aim or is it always reducible to some kind of self-interest? Is reputation a rational means to extract information from the social world? Should we rely on other’s evaluations? By reconstructing the (...) philosophy of reputation in the history of thought and analyzing the contemporary approaches to reputation in philosophy, the chapter also provides also some rudiments of an “epistemology of reputation.”. (shrink)

In the aftermath of scandals such as those at Enron and WorldCom, there is a growing suspicion of the corporate world. For this reason it is more important than ever for firms to maintain a good reputation. In Building Reputational Capital, Kevin T. Jackson offers a practical guide to taking the high road--the only path that leads to lasting success. Based on extensive research and real-world experience, Building Reputational Capital reveals basic principles of integrity and fairness with which firms (...) can build an enduring reputation. More than image, a firm's reputation is a form of capital often neglected in the boardroom and overlooked in conventional analyses of financial statements. Speaking directly to the work experience of real people in practical business settings, Jackson couples each principle with straightforward actions that drive management systems, and he provides tested strategies--from downsizing techniques to e-commerce tips--that cultivate the hidden power of a good reputation. He outlines the advantages of a superior reputation, describes the vital role the firm's leader must play, offers ways to build and protect your reputation on the Internet, and shows how to rescue your reputation once disaster hits. Perhaps most important, he shows how to strike the right balance of virtues like authenticity, honesty, responsibility, and stewardship of the environment, employees, and the economy. Highlighted with real-life success stories--from giants like Hewlett-Packard to small firms like Thanksgiving Coffee Company, Building Reputational Capital offers a simple but effective guide for executives, managers, entrepreneurs, legal professionals, and corporate consultants. (shrink)

Each day, a countless number of items is sold through online auction sites such as eBay and Ricardo. Though abuse is being reported more and more, transactions seem to be relatively hassle free. A possible explanation for this phenomenon is that the sites’ reputation mechanisms prevent opportunistic behavior. To analyze this issue, we first summarize and extend the mechanisms that affect the probability of sale of an item and its price. We then try to replicate the results as found (...) in four recent papers on online auctions. Our analyses reveal that (1) it makes sense to differentiate between ‘power sellers’ and the less regular users, (2) there are variables that have an effect on sales that are often not controlled for, (3) one should carefully consider how reputation is operationalized, ( 4) neglecting heteroscedastidty in the data can have serious consequences, and (5) there is some support indicating that effects differ across auction sites. (shrink)

Corporate Reputation (CR) has become an increasingly important topic in the social responsibility literature. In this exploratory study we relate reputation to crisis management by implementing an experimental survey in which respondents indicate how strongly they feel about a potential crisis. Findings reported here indicate that respondents’ reactions to the potential crisis varied according to the industry in which the firm operated.

Industry reputation crises trigger producers and consumers to switch to certification as a signal of quality, especially in a weak institutional environment. In this paper, we posit that firm certification as a signaling mechanism involves the co-evolution of firms and consumers. We investigate the impact of industry reputation crises on firm certification as a response strategy. Feedback between producers and consumers causes producers to seek more certifications over time to differentiate themselves from competitors. However, the proliferation of certifications (...) may dilute their credibility and reduce the effectiveness of the signal. Competition from imports that command higher trust from consumers exacerbates the problem in developing countries. We conduct empirical tests using firms in China’s dairy industry after an industry reputation crisis. The findings support our hypotheses. This study provides insights on the certification mechanisms through which producers and consumers interact and the effect of institutional environments on this interaction. It also offers implications for managers on how to better respond to industry crises and for policymakers on how to manage the certification market. (shrink)

The study of reputation has often focused on the creation of good reputations rather than on the varied means by which reputations are modified, or shifted, and the factors affecting such shifts. This paper develops a theory of reputation shifting and identifies five basic reputational actions, the types of strategic responses that can be taken to manage reputations.

The current study is designed to propose and test a model about the ethical reputation of a target manager who must decide whether to engage in earnings management. We employ an experimental approach to examine the potential negative reputation effects within the internal labor market of a firm that occur as a consequence of earnings management. We examine participants’ responses to a hypothetical (target) manager when both the target’s behavior and the corporate incentives were manipulated. Participants assessed how (...) ethical they believed a target manager to be, based on the target’s decision regarding earnings management and the nature of the corporate incentives. Participants also assessed the target’s managerial ability. Participants’ judgments regarding the target’s morality were significantly affected by the target’s behavior, but were not affected by the incentive structure. Ability judgments were significantly and positively related with morality assessments. Further analysis indicates that morality assessments mediate the relationships between the target’s behavior and the participants’ willingness to extend work-related opportunities to the target. Implications of these results for management control systems design and for future research are discussed. (shrink)

Research on social learning has identified mechanisms that learners use to decide from whom to learn. Several of these mechanisms indicate that learners prefer to learn from more competent people over less competent people. This requires learners to measure the competence of other people. We use this article to analyze the incentives that this measure of competence creates. Learners measure the competence of models, people they would consider learning from, and share these judgments with other learners. This gives each model (...) a reputation for competence within a community. Each model has a biological incentive to increase the magnitude of that reputation; at the very least, increasing the magnitude should make the model more attractive to potential mates. In this article, we present logic that indicates that one way for the model to increase the magnitude of that reputation is for the model to help people who think the model is competent. This reveals a novel evolutionary incentive for humans to help other humans. (shrink)

Alexander von Humboldt’s depictions of mountain vegetation are among the most iconic nineteenth century illustrations in the biological sciences. Here we analyse the contemporary context and empirical data for all these depictions, namely the _Tableau physique des Andes_ (1803, 1807), the _Geographiae plantarum lineamenta_ (1815), the _Tableau physique des Îles Canaries_ (1817), and the _Esquisse de la Géographie des plantes dans les Andes de Quito_ (1824/1825). We show that the Tableau physique des Andes does not reflect Humboldt and Bonpland’s field (...) data and presents a flawed depiction of plant occurrences and vertical succession of vegetation belts, arising from Humboldt’s misreading of La Condamine’s description (1751). Humboldt's 1815 depiction, by contrast, shows a distribution of high-vegetation belts that is consistent with La Condamine’s description, while the 1824 depiction drops innovations made in 1815 and returns to simply showing numerous species’ names, thus not applying Humboldt’s own earlier zonation framework. Our analysis of contemporary reactions to Humboldt’s TPA includes Francis Hall’s posthumously published 1834 illustration of Andean plant zonation near Quito and Humboldt’s reaction to Hall’s critique. Throughout his work on plant geography, Humboldt disregarded some of his own observations, or confused them. At stake was his reputation as an innovator in the field of plant geography and a discoverer of the sequence of high-elevation vegetation belts on the world’s mountains. (shrink)

What are the consequences of the tendency for ubiquitous online reputation calculation to lead not to more precise expressions of reputation capital but, rather, to greater reputational instability? This article contrasts two conceptions of online reputation, which enact opposing attitudes about the relation between reputation and the calculable. According to an early online reputation paradigm – reputation capital – users strove to achieve high scores, performing the presumption that reputation could be incrementally accumulated (...) and consistently measured within relatively stable spheres of value. Yet, ubiquitous calculation led not to more precise measurements of reputation, but rather to the increasing volatility of online reputation. Thus, a second online reputation paradigm – reputation warfare – has become increasingly prevalent, in which strategic actors indirectly capitalize on systemic volatility produced by reputation’s ubiquitous online calculation. Steve Bannon’s 2016 Trump campaign strategy, which mobilized trolls, exemplifies the indirect optimization of online reputation, placing an option on reputational volatility. (shrink)

This study investigates whether the market valuation of the two summary accounting measures, book value of equity and net income, is higher for firms with reputation for sustainability leadership, when compared to firms that do not enjoy such reputation. The results are interpreted through the lens of a framework combining signalling theory and resource-based theory, according to which firms signal their commitment to sustainability to influence the external perception of reputation. A firm’s reputation for being committed (...) to sustainability is an intangible resource that can increase the value of a firm’s expected cash flows and/or reduce the variability of its cash flows. Our findings are according to expectations and show that the net income of firms with good sustainability reputation has a higher valuation by the market, when compared to their counterparts. (shrink)

In many contexts, such as business, science and law, it is essential to determine whether a company, a product or a person in fact has the reputation attributed to it, regardless of whether that reputation has been rightly earned. In this paper I offer two necessary and jointly sufficient conditions for the attribution of a reputation to a subject within a social group. The first one concerns the way in which reputational information is spread among the members (...) of the relevant social group; the second is the existence, in most members of the group, of a disposition to interpret and evaluate a reputational object in a manner molded by reputational information. Reputational claims generate expectations that are tested every time a member of the group comes in contact with the reputational object. In many cases, the preferential search for behavioral evidence consistent with those expectations will result in a distorted evaluation of the reputational object. (shrink)

We investigate how negative news coverage of borrower’s impacts on climate change affects bank loan contracting. Using a sample of publicly traded US firms for the period 2000–2016, we show that loans initiated following negative news coverage about firm’s adverse climate-related incidents have significantly higher spreads, shorter maturities, more covenant restrictions, and a higher likelihood of collateral security requirements. We find no changes in client firm’s credit fundamentals after such incidents, indicating that lender’s reputational concerns rather than the longer-term environmental (...) impacts of their borrower’s actions are the primary drivers of these changes. This observation highlights the need for increased scrutiny of banks’ lending practices to ensure that they are genuinely committed to sustainability rather than merely engaging in symbolic actions. (shrink)

Peter Vanderschraaf. Reputational Enforcement of Covenants.

The interest in ethical leadership has grown in the past few years, with an emphasis on the mechanisms through which it affects organizational life. However, research on the boundary conditions that limit and/or enhance its effectiveness is still scarce, especially concerning one of the main misconceptions about ethical leadership, its incompatibility with effectiveness . Thus, the present study examines the relationship between ethical leadership and organizational deviance via affective commitment to the organization, as a reflection of the quality of the (...) employee–organization relationship and proposes this relationship is conditional on the supervisor’s personal reputation for performance . Using a sample of 224 employees and their respective supervisors from 18 organizations, we confirmed our hypotheses . Our findings suggest that ethical leadership is positively related to employees’ affective commitment to the organization, particularly when supervisor’s reputation for performance is high, which in turn is associated with decreased organizational deviance. The theoretical and practical implications of these findings conclude the paper. (shrink)

There is a tension between the reasonable desire not to be judgmental of other people’s behaviour or character, and the moral necessity of making negative judgments in some cases. I sketch a way in which we might accommodate both, via an evaluation of the good of reputation and the ethics of judgment of other people’s character and behaviour. I argue that a good reputation is a highly valuable good for its bearer, akin to a property right, and not (...) to be damaged without serious reason deriving from the demands of justice and the common welfare. Rash judgment wrongfully damages reputation and is sometimes a seriously immoral act. Rashness is not merely about lack of evidence, but involves lack of charity and is to be avoided even in some cases where the evidence of bad character or action is epistemically sufficient for judgment. I argue that the desirability of a good name for its holder, whether the reputation is deserved or not, means that in all but a relatively narrow range of cases it is always wrong to think badly of someone, even if they are bad. (shrink)

The present article concerns itself with the relationship between defamation and negligence in the protection of the interest in reputation. The bijection between defamation and reputation is typically thought of as perfect: defamation only protects reputation, while reputation is only protected by defamation. This article shows, however, that neither limb of the proposition is true; furthermore, there is no principled ground why they should be. In particular, there is no reason why the tort of negligence could (...) not prima facie extend the scope of its protection to reputation. It might seem that the fact that negligence, as a tort, requires by construction culpa, whereas defamation appears to rely on either more or less than that as a standard of liability, would prove an insuperable stumbling-block in the way of this suggestion. The hurdle, however, is not nearly as formidable as it might appear at first, because, as this article documents, negligence has for more than a century been acting as a magnet on the law of defamation, surreptitiously bringing its standard of liability increasingly close to negligence-culpa. (shrink)