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This study aims to examine the reputation effect by assessing whether fraudulent financial reporting is associated with high board turnover and significant loss of directorship held by directors affiliated with fraud firms. Although the Sarbanes–Oxley Act (SOX) and major stock exchanges enhance board independence and formalize committee requirements, the new rules also create a high demand for qualified directors in the director labor market. Thus, this study further examines the change in the reputation effect of directors at fraud firms after SOX.

This paper intends to answer two research questions: Do directors suffer significant loss of reputation when firms are caught in fraudulent financial reporting schemes? Is the loss of reputation of directors at fraud firms affected by the regulation of SOX? To examine the reputation effect, this paper investigates the differences in director turnover and loss of directorships between fraud and non-fraud firms. To examine the regulation effect, this paper investigates the differences in director turnover and loss of directorships of directors at fraud firms by comparing non-fraud firms’ director turnover and directorship loss between the pre-SOX and post-SOX periods.

Consistent with the reputation effect, this paper found that director turnover at fraud firms is significantly higher than that at non-fraud firms. It also found that the loss of directorships of directors at fraud firms is not significantly higher, which is consistent with findings of some prior research. The paper also investigates whether this reputation effect has changed after SOX but found no significant difference in the reputation effect at fraud firms. In conjunction with prior research that finds an increased demand for qualified directors in the labor market after SOX, the results imply that this shortage of qualified directors does not help fraud firms discipline directors after SOX.

The findings are limited by the sample selection of only the initial litigation of US firms which are charged of fraudulent financial reporting. The findings suggest that SOX creates an increased demand for qualified directors, and consequently results in a shortage of qualified directors in the post-SOX labor market. The shortage of qualified directors slows the director turnover and weakens firms’ ability to replace culpable directors. Future research is needed on how governance practices might contribute to the lack of turnover among board members and how to promote ongoing overhauls of boards.

The decision process for removing a director is complicated and lacks transparency. Shareholders often do not know the real reason for a director’s departure from the board. To increase the accountability of individual directors and information transparency, new rules are needed for the disclosure of evaluations of individual directors’ governance effectiveness.

Survey of previous studies (Helland, 2006; Srinivasan, 2005; Fich and Shivdasani, 2007) indicates mixed evidence on reputation effect and no evidence so far on the SOX regulation effect. This study fills the gap by extending the findings of prior research to investigate the reputation effect along with the regulation effect of SOX at fraud firms. Different from findings of some previous studies (Helland, 2006; Fich and Shivdasani, 2007), this paper provides evidence consistent with the reputation effect. It also provides new evidence on the unintended consequences of SOX on director turnover.

When a crisis occurs, do corporate social responsibility (CSR) activities protect organizational reputation by buffering negative effects or do CSR activities intensify negative effects, potentially leading to a worse reputation compared to if the organization had no prior CSR engagement? The authors hypothesize that if a crisis emerges in a domain aligned with an organization’s CSR initiatives (crisis-congruent CSR) backfire effects would arise, adversely affecting the organization’s reputation. Conversely, in cases of incongruence, where the crisis emerges in a domain not aligned with an organization’s previous CSR involvement, a buffering effect would manifest, protecting the organization’s reputation.

The authors conducted an experiment with a 3 (crisis-congruent, crisis-incongruent, and no CSR activities) × 2 (repeated measures) mixed factorial design. In the first scenario, no information was provided concerning a company’s social commitment. Alternatively, participants were exposed to an article illustrating the company’s dedication either to healthcare (crisis-incongruent commitment) or to combating sexism (crisis-congruent commitment). Afterward, participants were presented with a newspaper article addressing allegations of sexism against the company’s CEO.

The findings demonstrate that prior CSR activities have the potential both to serve as a buffer and to cause backfire effects in times of crisis. Domain congruence is the decisive moderator of these effects: Crisis-incongruent CSR activities acted as a buffer, crisis-congruent CSR activities “backfired” and led to more negative perceptions of the company’s reputation.

The study directly contributes to the understanding of CSR effects in crisis communication, while also addressing the often paradoxical and contradictory findings of prior studies.

Crisis managers believe in the value of a favorable, pre‐crisis reputation. The prior reputation can create a halo effect that protects an organization during a crisis. The prior reputation/halo might work as a shield that deflects the potential reputational damage from a crisis. Or the prior reputation/halo might encourage stakeholders to give the organization the benefit of the doubt in the crisis (reduce attributions of crisis responsibility). Oddly, researchers have had little luck in producing a halo effect for prior reputation in crisis situations. The purpose of this paper is to present two studies designed to test if the halo effect could occur and which of the two dynamics of the prior reputation halo best serve to explain the benefits of a favorable, pre‐crisis reputation.

The research focuses on a set of studies conducted to illustrate the halo effect and to explore how it serves to protect an organization during a crisis. The implications of the findings for post‐crisis communication are discussed.

The halo effect for prior reputation in crisis was created. The halo operated in a limited range for organizations with very favorable prior reputations. The data also supported the halo as shield dynamic rather than the halo as benefit of the doubt.

The paper provides insight into the area of reputation and crisis management.

The purpose of this study is to examine the consumer-side effects of “under new management” (UNM) signs. The authors integrate cue-utilization theory and relevance theory to guide hypotheses about the conditions under which these signs are and are not beneficial.

Two consumer-based experiments were used to examine the quality and reputation effects of restaurants signaling a management change on potential and existing customers.

The results suggest that positive and negative effects are possible. The direction of these effects is contingent upon consumers’ prior experience, type of service (i.e. search/experience) and the relevance of the signal.

The study is limited to one industry (i.e. restaurants) and examines the effects of market signals on perceived quality and reputation. In addition, this research brought forth the notion of “signal relevance” and suggested that it may be explicitly tied to attributions. However, this assertion must examine multiple signals (relevant/irrelevant) and their contingent effects on consumer perceptions.

The findings advise businesses to use caution when using signals such as an “UNM” sign, as they appear to have different effects depending on the experience of the consumer with the service and the relevance of the signal.

This research contributes to the literature on cue utilization theory to understand the effects of marketplace cues on consumer perceptions. It contributes to marketing theory and practice by proposing a model of cue effects based on prior customer experience, type of service and cue relevance.

The purpose of this paper is to examine the role of prior-CSR reputation in protecting a company’s CSR reputation during product-harm crises and how it influences consumers’ crisis-related behavioral intentions (i.e. supportive communication, resistance to negative information and crisis resiliency). The authors test whether the impact of prior-CSR reputation differs by crisis type as well.

A randomized 2 (CSR reputation: good vs bad) × 2 (product-harm crisis type: tampering vs preventable) full factorial design in two industry settings (food industry and retail industry) with consumer samples was conducted.

The results revealed the determinant role of positive prior-CSR reputation in protecting reputational assets. A company with positive CSR reputation experiences no decrease in its CSR reputation during victim crises and fairly minor decreases during preventable crises. However, a company with a bad prior-CSR reputation experiences a greater decline in its CSR reputation across both crises; the level of decline during victim crises was as substantial as the decline experienced during a preventable crisis. The prior-CSR reputation directly affects consumers’ crisis-related intentions, and indirectly does so through post-CSR reputation. As post-CSR reputation becomes more positive, consumers display greater resistance to negative information, supportive communication intent and crisis resiliency.

This study advances the understanding of the role of corporate reputation during crises and provides additional empirical evidence of how the buffering effect of CSR can extend beyond product-related intentions among consumers. The findings can induce companies to adopt CSR programs more systematically and proactively under a long-term strategic plan.

Research on acquisition performance has not considered the customer perspective for a long time. Based on associative network theory, we propose two spillover effects – forward and reverse – to reflect the effect of acquirer and target reputation on customer responses toward a horizontal acquisition. The reputation of both the acquirer and target can transfer to acquisition and affect customer attitudes toward the post-merged corporation and target customer retentions. However, the influence of the acquirer reputation (forward spillover effect) is stronger than that of the target reputation (reverse spillover effect). Because of asymmetric spillover effects from the acquirer and target, we suggest that the performance effects of A acquiring B may not be the same as that of B acquiring A, given that A and B are highly related firms. The level of post-acquisition brand integration moderates the asymmetric spillover effect on acquisition performance. A higher level of post-acquisition brand integration indicates a stronger asymmetric spillover effect on acquisition performance.

Based on impression management theory, the authors ask how marketing activities build organizational reputation and examine the mediating mechanisms of desired impressions, and the moderating impact of national culture. Specifically, and in the context of higher education (HE) institutions, the authors examine the influence of relational marketing and traditional advertising on organizational reputation through the mediation of desired impressions (e.g. quality of learning, career prospects and extracurricular activities) across countries and specify the moderation role of cultural variables.

This study estimates empirical models using a survey data set comprising 1,890 student responses from 10 universities in 8 countries. The authors use confirmatory factor analysis (CFA) and measurement invariance models, as well as ordinary least squares with robust standard errors to test the hypotheses.

The results indicate that marketing activities affect organizational reputation through the mediation of desired impressions in line with our theoretical reasoning. Specifically, the results show that (1) relational marketing has direct and indirect effects on organizational reputation; (2) relational marketing has a higher influence on organizational reputation in countries with lower individualism and lower masculinity scores; (3) quality of learning mediates the relationship between traditional advertising and organizational reputation; (4) quality of learning also mediates the association between relational marketing and organizational reputation; (5) career prospects mediate the relationship between relational marketing and organizational reputation; (6) traditional advertising does not have a direct but only an indirect effect on organizational reputation; and (7) these findings are net of the effect of respondents', universities', and countries' characteristics.

The findings contribute to the body of knowledge on the antecedents of organizational reputation, from an international marketing perspective. The results extend the impression management by integrating constructs that have been studied independently into a cohesive framework that links marketing activities, desired impressions and organizational reputation. With the study, impression management theory provides a framework to study the impact of marketing activities on organizational reputation not only in domestic but also in international markets.

By asking the target market about the importance of different marketing activities, their expectations of the organization and its reputation, HE administrators can employ the model proposed in this study to assess the relevant marketing strategies that will drive desired impressions which in turn will influence reputation.

While there are studies that focus on the impact of several constructs on organizational reputation in an international context, it is striking to observe that extant research is silent on how (via what mediating mechanisms) marketing activities work as an antecedent of organizational reputation. To address this gap, we examine marketing activities as antecedents of organizational reputation in an international, cross-country context, and specify the moderation role of cultural variables.

The purpose of this paper is to examine how corporate reputation interacts with corporate social responsibility (CSR) fit and affects stakeholders’ skeptical attribution (SA) of CSR motives, as well as their attitudes, supportive communication intent and purchase intent. This study proposes that a high-fit CSR program does not necessarily engender more favorable outcomes, nor does it stimulate SA. The study proposes the effects of CSR fit differ by corporate reputation. For bad-reputation companies, low-fit is anticipated to generate more desirable CSR outcomes than high-fit initiatives.

Two experiments were conducted. The first experiment employed a randomized 2 (CSR fit: high fit vs low fit) × 2 (good reputation vs bad reputation) × 2 (Industry: food retailing and insurance) full factorial design to examine the suggested hypotheses. The second study employed a randomized 2 (CSR fit: high fit vs low fit) × 2 (good reputation vs bad reputation) full factorial design with consumer samples to replicate the conceptual relationships among variables in the first study.

While reputation plays a dominant role in influencing stakeholders’ CSR-related responses across both CSR fit situations, a SA partially mediates the relationship between reputation and stakeholder reactions. CSR fit interacts with reputation, and influences the partial mediation process through SA; under a bad reputation condition, low-fit CSR engenders less SA and results in better stakeholder reactions. A similar tendency was found with supportive communication intent and purchase intent. High-fit CSR initiatives by a negative reputation company engendered the weakest supportive intent and purchase intent. For a reputable company, across both CSR fits, respondents displayed generally very positive attitudes toward, greater intent to support, and intent to purchase from the company.

The study findings provide useful and empirically supported logical explanations of why high-fit CSR programs sometimes cause backlash effects, despite the general consensus that such initiatives generate positive outcomes. This study offers an alternative and more relevant perspective to conceptualize the complexity of anticipating CSR outcomes.

The purpose of this paper is to examine the relationship between bilateral country reputation and export volume to the country in which that reputation is held.

The unique bilateral data set consists of 861 country pairs. Country reputation measures are from a global survey, in which respondents in 20 countries rate the reputation for products and people of 50 other countries. This data set is then analyzed against actual export data for each country-pair using the well-established structural gravity model of international trade.

The authors find that each improvement in a world ranking of a country’s reputation for products (in a target country) is associated with a 2 percent increase in exports to that particular country; the effect is equivalent to the importing country decreasing a tariff by as much as 2.9 percent. Furthermore, the authors find that different aspects of country reputation – for its products and its people – attenuate distinct forms of uncertainty, and thereby stimulate export volume in distinct ways.

This study shows that the relationship between country reputation and export volume is a substantive and empirically valid topic of study. For public policy makers looking to stimulate exports to a specific country, improving their respective country’s reputation in that country appears to be a viable alternative to other levers (e.g. trade negotiations, free trade agreements). For business leaders at international companies, the findings suggest that companies may consider country reputation as a factor when choosing to which countries they wish to expand.

The notion that country reputation can contribute to aggregate export volume has intuitive appeal. Yet, aside from research on country-of-origin effects which has concentrated on the individual consumer level, the notion of country reputation contributing to aggregate effects has so far been based mostly on conjecture and anecdotal evidence. This is the only study to the authors’ knowledge that empirically tests this relationship using a bilateral measure of reputation as a determinant of export volume within one of the most successful empirical frameworks, the structural gravity model of international trade. The findings suggest that for many countries, their reputation may contribute to billions of dollars in export volume.

The purpose of this paper is to examine consumer reactions to product categories, online seller reputation, and brand name syllables.

This paper uses four experimental designs to explore the seller reputation, product category, and brand name syllable effects in internet shopping. The authors chose sellers of (low/high) repute from Yahoo Mall. ANOVA is used to evaluate the results.

Seller reputation moderates the effect of the brand name syllable level on purchase intention and product category moderates the effect of the brand name syllable level on purchase on internet (experiment 1). Consumers take the longest time to make purchasing decisions when buying credence goods or buying from sellers of low repute and that the response time mediates the moderating role of the product category (experiment 2) or reputation (experiment 3). Moreover, the effect of brand name syllable levels chosen/assigned by sellers of low repute is weakened for consumers with low (vs high) skepticism toward non-store shopping (experiment 4).

This study is helpful to online sellers if they can identify their reputation, product category and those consumers have skepticism, they can create extra profit through brand name syllable practice.

This paper extends the literature on consumers’ brand name syllable processing by identifying important moderators and probing into the decision process. The results allow us to substantiate prior research and suggest prescriptive strategies for internet retailers.