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Using the L. Bebchuk, Cohen, and Ferrell (2009) entrenchment index (E-index), the authors examine the relation between management entrenchment and the probability of a firm being implicated in the stock option backdating scandal. The authors conduct the analysis of this study using logistic regression, and they document a negative relation between the E-index and the probability of a firm being implicated in the stock option backdating scandal. The results of this study are consistent with the view that management entrenchment is advantageous to shareholders as it protects managers from short-term reporting pressures and egregious opportunistic behavior that can be detrimental to firm value.

This study aims to explore the main features of managerial performance reporting (MPR) in Ghana and applied a national social-cultural framework to understanding the MPR practices.

It is a qualitative study based on responses from mid-level managerial employees within the top companies in Ghana dubbed Ghana Club 100 (GC100). GC100 includes a balanced mix of companies across varied industry classifications and local and multinational companies (MNCs). This enriches the data and deviates from similar studies that have usually relied on data from multinational companies.

There is evidence that while MPR practices in Ghana do not significantly deviate from western approaches, the underlying reasons for such managerial practices and actions may defer on national socio-cultural lines. This study discusses how various cultural attributions explain the features and motivations for MPR practices in Ghana, including a difference in expectations about the purpose of an MPR.

MNCs must be guided by the findings of this study in their drive to inculcate standardised practices across organisations. It is also essential for MNCs to appreciate the more than usual reliance on verbal cues and symbols in interpreting the appropriate course of action. Regulators must consider systematic activities that reduce the tension and suspicion between them and business actors to improve information transparency. Whistleblowing schemes, while helpful, may not be effective because organisational agents within MPR practice consider themselves part of an “in-group” and manage their dissonance through categorisation, rationalisation and superficial attention to standards. Because of the excessive use of unwritten cues, auditors must consider visits to the client’s operational premises and other independent observation efforts vital to their evidence gathering process.

To the best of the author’s knowledge, this paper is among the first to evaluate MPR practices based on direct responses from “persons close to the MPR action” rather than the current overreliance on secondary data sources such as content analysis.

This study which is positioned in the ambit of control research investigates the impact of ex ante contractual completeness on opportunistic behaviors and ex post transaction costs, while assessing how these affect relationship termination intention. This study aims to examine alternative attractiveness as a necessary moderator of the nexus between transaction cost and relationship termination intention.

Data gathered from 211 companies in South Korea that have installed and run outsourced vending machines are analyzed and used to validate the study’s theoretical and empirical contributions.

The findings, which rely only on data from companies that outsource and those that run outsourced vending machines, show that contractual completeness negatively affects both active and passive opportunism. The study also discovers that active opportunism positively affects both bargaining costs and monitoring costs, whereas passive opportunism has a positive and direct effect on maladaptation costs but a negative effect on monitoring costs. It further finds that both bargaining and maladaptation costs have positive and direct effects on relationship termination intention, while monitoring costs have a negative effect on the same. Furthermore, it is observed that alternative attractiveness moderates the relationships between bargaining costs and relationship termination intention, as well as maladaptation costs and relationship termination intention.

This study demonstrates that contractual completeness can serve as an important ex ante control mechanism, whereas the two types of opportunism can raise transaction costs. Furthermore, alternative attractiveness is identified as a driver of the impact of transaction costs on relationship termination intention.

A key point of the departure of this study is that it examines the moderating role of alternative attractiveness in the relationship between transaction cost and relationship termination intention. The paper also advances the control literature by emphasizing the critical role that contractual completeness plays in reducing the occurrence of (both active and passive) opportunism in business relationships (especially companies that outsource).

The purpose of this paper is to examine the supervening loss of inter-organisational trust in long-term commercial contracts. The underlying research question is whether contract law – the legal institution regulating economic exchanges – should intervene and enable a party to a long-term commercial contract to extricate itself from a situation where a relationship of trust has broken down irretrievably.

This paper uses doctrinal methodology and theoretical conceptualisation to answer the underlying research question. The legal instrument chosen for analysis purposes is the UNIDROIT Principles of International Commercial Contracts. This paper also draws on extant literature on inter-organisational trust (including conceptual and empirical studies) to support the arguments and propositions. Furthermore, this study proceeds to assess the substantive justifiability of the proposed remedial measure using four normative values: legal certainty and predictability, protection of the performance interest, economic efficiency and the preservation of the relation.

The central argument put forward in this paper is the reformulation of draft Article 6.3.1 proposed by the UNIDROIT Working Group on Long-Term Contracts, which confers a novel right to terminate for a compelling reason. This paper presents a multidimensional model of inter-organisational trust that would serve as the conceptual framework for the proposed reformulation of the provision and establishes a coherent juridical basis for the legal solution that would accord with the Principles of International Commercial Contracts’ general remedial scheme. As for the normative assessment, this paper demonstrates that the proposed remedial measure would significantly promote efficient outcomes and positively serve the norms of legal certainty, protection of the performance interest and the preservation of the relation.

This paper addresses the lacuna in current legal scholarship in relation to the adverse socio-economic effects following trust violation and deterioration in inter-organisational relationships. Additionally, the propositions and findings should contribute to the workings of the UNIDROIT in adopting new rules and principles that would serve the special requirements of cross-border trade.

This study aims to outline the role of causal attributions in consumer responses to irresponsible corporate behaviour. Specifically, this paper presents a moderated mediation model that explains how four types of perceived motives behind an irresponsible action shape corporate blame and word-of-mouth recommendations.

To test the hypotheses, the study uses data from a large survey assessing consumer reactions to a real case of corporate socially irresponsible behaviour in the banking industry.

The findings show that market-, unethicality- and rogue employee-driven attributions increase corporate blame and subsequently make people more likely to spread negative comments regarding the culprit. The difficult situation of a bank, as a perceived reason for wrongdoing, does not reduce the blame attributed to the irresponsible organisation.

The literature offers little information on the attributions people make following egregious corporate behaviour; however, such cognitions can play an important role in stakeholders’ reactions to wrongdoing. This study therefore extends the understanding of how irresponsibility attributions affect consumers’ responses to misbehaviour. Given the empirical context, the findings might be particularly important for communication and bank managers.

We examine the effect of peer honesty on focal manager honesty in a budget reporting setting. We disclose peer honesty to the focal manager at three levels: no, partial, and full disclosure of the reporting behavior of the other managers in the focal managers’ cohort. In partial disclosure, only the reports of the least honest peers are disclosed to the focal manager. In full disclosure, all managers’ reports in the cohort are disclosed to the focal manager. We predict and find that disclosure of other managers’ reports leads to less honesty compared to the absence of disclosure. We show that disclosure changes the focal manager’s perceptions of what constitutes acceptable reporting behavior, such that reporting more dishonestly becomes more acceptable. Our results have implications for understanding fraud dynamics and have practical implications for the design of control systems, as they suggest that managers will use peer dishonesty to justify their own dishonesty, even when they know that only some of their peers report dishonestly.

One particular egregious type of workplace mistreatment is supervisor abuse, which has received extensive attention due to its heavy cost to organizations including up to 23 billion dollars in annual loss resulting from increases in absenteeism, health care costs, and productivity loss. Employees attribute causes to abusive supervision, and these attributions impact subsequent reactions. In some cases, employees may feel that abusive supervision is justified, leading to the reaction of Schadenfreude, or pleasure in another’s pain. In this chapter, we discuss antecedents to Schadenfreude, its role in observed mistreatment, and propose a conceptual model based on attribution theory.

Supply chain fraud is a significant global concern for firms, consumers and governments. Evidence of major fraud events suggests the role of supply chain structures in enabling and facilitating fraud, as they often involve several parties in complicated networks designed to obfuscate the fraud. This paper identifies how the structural characteristics of supply chains can play an important role in enabling, facilitating and preventing fraud.

The research follows a theory elaboration approach. The authors build on structural holes theory in conjunction with a multiple case study research design to identify new concepts and develop propositions regarding the role of network structure on supply chain fraud.

This research shows how structural holes in a supply chain can create advantages for unscrupulous firms, a role we call tertius fraudans, or the cheating third. This situation is exacerbated by structural ignorance, which refers to the lack of knowledge about structural connections in the network. Both structural holes and structural ignorance can create information gaps that facilitate fraud, and the authors propose solutions to detect and prevent this kind of fraud.

This paper extends structural holes theory into the domain of fraud. Novel concepts including tertius fraudans, structural ignorance and bridge collapse are offered, alongside a series of propositions that can help understand and manage structural supply chain fraud.