Journal of Business Ethics

Wang, Liang; Tan, Justin

doi: 10.1007/s10551-023-05439-4pmid: N/A

The way in which business ethics change over time will remain theoretically unclear unless we empirically reveal the temporal coevolution and coalignment among a changing environment, transitional institutions, strategic adaptations, and performance implications. To revitalize this coevolutionary perspective in business ethics research, in this special issue, we ask the following question: how do business ethics practices coevolve with a changing society and technology advancement as a result of the strategic choices of organizations in adapting to and shaping the environment? This special issue includes a collection of seven empirical studies of business ethics in China that differ in methodology and empirical context but collectively showcase the change in business ethics practices in an emerging economy and the processes underlying this change. Based upon the findings, we propose a conceptual model of the coevolution among business ethics practices, technological innovation, institutional transition and disruptive events; then, we pose questions for future research.

Liu, Xiao-xiao; Xiong, Feng; Du, Xingqiang

doi: 10.1007/s10551-023-05436-7pmid: N/A

The ethical controversies of firms in the sharing economy (SE) have recently drawn attention and caused debates. Ridesharing firms violate laws in many countries, but how they become legitimised remains underexplored. We apply the co-evolutionary perspective to examine how ethical controversies, legitimation and institutionalisation co-evolve in the ridesharing segment in the dynamic and changing institutional environment of China. We conducted a case study on Didi using firm-institution dual-level analysis based on stakeholder salience theory (SST) and the Orders of Worth framework. Our findings uncover ethical controversies among stakeholders with different levels of salience. We also reveal a dynamic interplay between the legitimacy work of Didi and the institutional-level market regulations on ridesharing firms. We develop a process model demonstrating the co-evolution among the changes in ethical controversies, new market category emergence and legitimation of ridesharing firms. These findings shed light on the application of the co-evolutionary perspective in analysing ethical controversies among multiple stakeholders’ evolving interests in the SE context.

Jiang, Wei; Wang, Kui; Zhou, Kevin Zheng

doi: 10.1007/s10551-023-05434-9pmid: N/A

Building on the co-evolutionary perspective, this study investigates the reciprocal and co-evolving relationship between political ties and green innovation in the presence of institutional and environmental changes. Using panel data for Chinese listed private firms for a sample period that runs from 2013 through 2016, our findings indicate that political ties have an overall positive impact on green innovation. Moreover, political ties and green innovation mutually reinforce each other in less developed regions or heavily polluted areas; however, green innovation discourages the formation of political ties in regions with high levels of institutional development or less environmental pollution. These findings provide novel insights into the co-evolution of and co-alignment between political strategy, green innovation, institutions, and environments in emerging economies.

Chen, Yanying; Ping, Liang; Liang, Feng Helen

doi: 10.1007/s10551-023-05438-5pmid: N/A

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.

Zhong, Shuxin; Zhao, Xiaoyang; Song, Juan

doi: 10.1007/s10551-023-05437-6pmid: N/A

Multinational enterprises (MNEs) must often address moral conflicts given their responsibilities to meet conflicting demands from diverse stakeholders in transnational operations. Thus, this study constructs a comprehensive theoretical framework to understand the co-evolution between MNEs’ ambidexterity strategies and moral conflicts by incorporating studies on institutional theory and strategic management. Through a longitudinal case study, we find that the balance of three dimensions of ambidexterity strategies influences the content and intensity of MNEs’ moral conflicts by shaping the dual structure of stakeholders from home and host countries. Further, moral conflicts reshape the balance of ambidexterity strategies by the pressure of legitimacy and performance. Hence, to achieve better performance in transnational operations, MNEs must not only pay attention to the contingent ambidexterity strategies in dynamic environments, but also leverage the fitness among different dimensions of ambidexterity strategies. The findings provide implications for MNEs’ transnational operations in the increasingly complex global business.

Zhao, Meng; Ma, Xufei; Park, Seung Ho; Luo, Lingli

doi: 10.1007/s10551-023-05433-wpmid: N/A

The coevolution process enables organizations to adapt to and influence their external environment. Multinational corporations (MNCs) operating in dynamic foreign markets use this capability to achieve operational sustainability. MNCs in China operate in a changing stakeholder environment that features rising consumer activism and local stakeholders' persistent ethical problems and encounter recurrent consumer crises. Coevolving with this environment requires MNCs to react to consumer challenges and actively influence the environment by improving stakeholders’ ethical behavior. Based on the attention-based view and bounded rationality studies, we propose that the tension between expansion attention and stakeholder attention hinders MNCs from coevolving with this environment. Our analysis of MNC-linked consumer crises in China reveals that MNCs can reduce the consumer crisis risk by maintaining continuous attention to improving the ethical behavior of local employees, suppliers, and dealers. In contrast, MNCs' rapid local expansion weakens this stakeholder's attention, expanding MNCs' crisis risk. Our findings reveal an attention-based constraint to MNCs' coevolution and inform approaches to overcoming this constraint. This paper also extends international attention studies by affirming the significance of matching the focus of attention with environmental change for MNCs’ operational sustainability in foreign markets.

Hu, Helen Wei; Zhang, Jiamin

doi: 10.1007/s10551-023-05435-8pmid: N/A

How do corporate social responsibility (CSR) disclosure and innovation investment co-evolve with organizational forms to affect firm market value? To address this question, we draw on the co-evolutionary perspective and theorize that the contingency effect of CSR reporting is more pronounced for firms with high uncertainty and low legitimacy by comparing start-up firms vs. established firms and privately owned enterprises (POEs) versus state-owned enterprises (SOEs). Moreover, taking a dynamic approach, we propose that the effects of CSR and innovation investment on market value change when the organizational form transitions over time. Specifically, we argue that when start-up firms transitioned to established firms or when POEs were transformed from SOEs, the strengthening effects of CSR reporting become less pronounced. We test our theory using panel data on 2204 Chinese listed firms for the period of 2008–2017.

Wang, Ding; Wei, Jiang; Noorderhaven, Niels; Liu, Yang

doi: 10.1007/s10551-023-05432-xpmid: N/A

This study examines the effects of corporate social responsibility (CSR) performance of Chinese firms on the formation of cross-border alliances with partners in developed countries. We use signaling theory and the co-evolutionary perspective as bases in proposing that the signaling effects of CSR performance on cross-border alliance formation are subject to the influences of subnational, national, and cross-national institutions. By using a longitudinal data set, we find that the signaling effects of CSR performance on cross-border alliance formation emerged only after a national system of CSR-related institutions had been established. Once this framework was set up, the effectiveness of CSR as a signal was subject to subnational (intra-country) and cross-national (inter-countries) institutional differences. We conclude that combining signaling theory with the co-evolutionary perspective contributes to CSR research in emerging markets.