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Corporate misconduct and the loss of trust

Corporate misconduct and the loss of trust PurposeTo identify a typology of corporate misconduct affecting trust; to test the relative ability of individual misconducts to reduce trust and; to explain differences in how individuals respond to corporate crises.Design/methodology/approachThe main research design uses conjoint analysis. Respondents (n= 404) rated eight combinations of 6 types of misconduct, identified from prior work on trust as likely to reduce trust. Initial levels of trust were established by varying both country of origin and product type. FindingsThe importance ranking for the 6 types was consistent across most conditions, with ‘bending the law’ and ‘not telling the truth’ as the most and ‘acting unfairly’ and ‘acting irresponsibly’ as the least salient in damaging trust. Respondent characteristics influenced the effect size.Practical implicationsAs loss of trust represents a loss of reputation, understanding how and when the framing of misconduct damages trust is important in managing reputation risk. The impact of any report of misconduct can be moderated if attributed by a company, the media or the individual, to a type that is less damaging to trust. Originality/valueOur study adds to our understanding as to why individuals respond differently to corporate misconduct and contributes to prior work on reputation damage. The typology of corporate misconduct developed and tested here offers a different framework for researchers and practitioners with which to explore loss of trust and to develop existing crisis communication theory. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png European Journal of Marketing Emerald Publishing

Corporate misconduct and the loss of trust

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Publisher
Emerald Publishing
Copyright
Copyright © Emerald Group Publishing Limited
ISSN
0309-0566
DOI
10.1108/EJM-11-2014-0729
Publisher site
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Abstract

PurposeTo identify a typology of corporate misconduct affecting trust; to test the relative ability of individual misconducts to reduce trust and; to explain differences in how individuals respond to corporate crises.Design/methodology/approachThe main research design uses conjoint analysis. Respondents (n= 404) rated eight combinations of 6 types of misconduct, identified from prior work on trust as likely to reduce trust. Initial levels of trust were established by varying both country of origin and product type. FindingsThe importance ranking for the 6 types was consistent across most conditions, with ‘bending the law’ and ‘not telling the truth’ as the most and ‘acting unfairly’ and ‘acting irresponsibly’ as the least salient in damaging trust. Respondent characteristics influenced the effect size.Practical implicationsAs loss of trust represents a loss of reputation, understanding how and when the framing of misconduct damages trust is important in managing reputation risk. The impact of any report of misconduct can be moderated if attributed by a company, the media or the individual, to a type that is less damaging to trust. Originality/valueOur study adds to our understanding as to why individuals respond differently to corporate misconduct and contributes to prior work on reputation damage. The typology of corporate misconduct developed and tested here offers a different framework for researchers and practitioners with which to explore loss of trust and to develop existing crisis communication theory.

Journal

European Journal of Marketing – Emerald Publishing

Published: Jul 11, 2016

References

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