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Article
Publication date: 1 January 2002

Fouad K. AlNajjar and Ahmed Riahi‐Belkaoui

The article hypothesizes that the level of reputation affects both the informativeness of earnings and the magnitude of discretionary accounting accrual adjustments. The…

Abstract

The article hypothesizes that the level of reputation affects both the informativeness of earnings and the magnitude of discretionary accounting accrual adjustments. The hypothesis exploits the following: the positive relationship between reputation and firms' risk‐return profiles, and managers' incentives in using discretionary accounting accrual adjustments. Results show that reputation is positively associated with earnings' explanatory power for returns, and related to the magnitude of accounting accrual adjustments.

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Review of Accounting and Finance, vol. 1 no. 1
Type: Research Article
ISSN: 1475-7702

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Book part
Publication date: 1 July 2014

Gerald R. Ferris, John N. Harris, Zachary A. Russell, B. Parker Ellen, Arthur D. Martinez and F. Randy Blass

Scholarship on reputation in and of organizations has been going on for decades, and it always has separated along level of analysis issues, whereby the separate…

Abstract

Scholarship on reputation in and of organizations has been going on for decades, and it always has separated along level of analysis issues, whereby the separate literatures on individual, group/team/unit, and organization reputation fail to acknowledge each other. This sends the implicit message that reputation is a fundamentally different phenomenon at the three different levels of analysis. We tested the validity of this implicit assumption by conducting a multilevel review of the reputation literature, and drawing conclusions about the “level-specific” or “level-generic” nature of the reputation construct. The review results permitted the conclusion that reputation phenomena are essentially the same at all levels of analysis. Based on this, we frame a future agenda for theory and research on reputation.

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Research in Personnel and Human Resources Management
Type: Book
ISBN: 978-1-78350-824-2

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Book part
Publication date: 16 July 2019

James Agarwal and Oleksiy Osiyevskyy

Corporate reputation is a strategic asset leading to numerous positive firm-level outcomes. Motivated by the prediction that the translation of customer-based corporate…

Abstract

Corporate reputation is a strategic asset leading to numerous positive firm-level outcomes. Motivated by the prediction that the translation of customer-based corporate reputation to customer-level outcomes (trust, customer–company identification, and word-of-mouth intentions) might be highly context-dependent, we investigate the moderating role of national culture (particularly, individualism–collectivism dimension) and individual trait (self-construal) in the association between reputational dimensions (product and service efficacy, market prominence, and societal ethicality) and their outcomes. Using survey data from two countries (US and India, N = 812), we estimate the effects of corporate reputation on focal outcomes, moderated by country as a proxy for individualism/collectivism and independent self-construal (IND)/interdependent self-construal (INTER). The results strongly suggest that when individual-level variables are taken into account, the country-level variable does not affect the translation of reputational dimensions to customer-level outcomes. Moreover, individuals high on IND are more responsive to utilitarian (egoistic) reputational dimensions of product and service efficacy, whereas individuals high on INTER are more sensitive to the group-oriented reputation for market prominence and society-oriented reputation for social ethicality. The reported findings have major implications for cross-country reputational research and global reputation management strategies.

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Book part
Publication date: 3 May 2016

Jose Miguel Abito, David Besanko and Daniel Diermeier

We model the interaction between a profit-maximizing firm and an activist using an infinite-horizon dynamic stochastic game. The firm enhances its reputation through…

Abstract

We model the interaction between a profit-maximizing firm and an activist using an infinite-horizon dynamic stochastic game. The firm enhances its reputation through “self-regulation”: voluntary provision of an abatement activity that reduces a negative externality. We show that in equilibrium the externality-reducing activity is subject to decreasing marginal returns, which can cause the firm to “coast on its reputation,” that is, decrease the level of externality-reducing activity as its reputation grows. The activist, which benefits from increases in the externality-reducing activity, can take two types of action that can harm the firm’s reputation: criticism, which can impair the firm’s reputation on the margin, and confrontation, which can trigger a crisis that may severely damage the firm’s reputation. The activist changes the reputational dynamics of the game by tending to keep the firm in reputational states in which it is highly motivated to invest in externality-reducing activity. Criticism and confrontational activity are shown to be imperfect substitutes. The more patient the activist or the more passionate it is about externality reduction, the more likely it is to rely on confrontation. The more patient the firm and the more important corporate citizenship is to firm’s brand equity, the more likely that it will be targeted by an activist that relies on confrontation.

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Article
Publication date: 28 September 2010

Christian Coenen, Daniel von Felten and Mirjam Schmid

The purpose of this paper is to develop an empirically tested framework for public awareness and reputation of facilities management (FM) as a business sector.

Abstract

Purpose

The purpose of this paper is to develop an empirically tested framework for public awareness and reputation of facilities management (FM) as a business sector.

Design/methodology/approach

A national survey of representative sections of the population was designed and carried out to determine the level of public awareness and the reputation of FM. This survey was based on image/reputation categories from the international European Performance Satisfaction Index studies.

Findings

The findings provide a highly differentiated picture and give an interesting insight into the varied understanding of FM. Only a small fraction of the population has a realistic understanding of what the term FM means. The additional information collected about selected features of the respondents (age, gender, occupation, education, household income, etc.) facilitates interesting cross‐references to the level of public awareness and reputation of FM thus allowing an illuminating analysis of the findings.

Practical implications

A framework for measuring public awareness and reputation of FM is presented and tested. It can be used in the development of a cross‐national survey. In this study, the measurement of public FM awareness and reputation is applied only to one pilot country and further international research is needed to validate this tool within other geographical settings.

Originality/value

This survey represents the first quantification of public awareness and reputation of FM and is planned to be repeated on an international level at a two‐year interval, thus enabling comparisons between countries and corporations.

Details

Journal of Facilities Management, vol. 8 no. 4
Type: Research Article
ISSN: 1472-5967

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Article
Publication date: 4 November 2014

Harlan E. Spotts, Marc G. Weinberger and Michelle F. Weinberger

– The purpose of this research is to understand the relationship between publicity, advertising activity and corporate sales in the context of a company’s existing reputation.

Abstract

Purpose

The purpose of this research is to understand the relationship between publicity, advertising activity and corporate sales in the context of a company’s existing reputation.

Design/methodology/approach

The study brings together four unique industry datasets and uses discriminant analysis and multiple regression methods to examine the relationship between existing corporate reputation, publicity, advertising activity and sales levels for major multi-national companies in the technology products sector.

Findings

Positive publicity is most important in distinguishing between firms with higher and lower sales. The effects of negative publicity and advertising are dependent on a firm’s existing reputation. For companies with weaker reputations, positive publicity in tandem with business-to-consumer (B2C) advertising is most highly associated with higher company sales. Conversely, for firms with stronger existing reputations, advertising has a significantly diminished role; positive and even negative publicity are most crucial in distinguishing between companies with high and low sales. Negative publicity can be harmful to these firms though if it is not balanced by more positive publicity. Finally, the topic of news coverage is related to sales. Generally, stories that are positive reporting on business outcomes, leadership and business future and marketing practices are most important in discriminating between firms with stronger vs weaker sales.

Practical implications

For this set of technology product firms, publicity and advertising are relevant for sales. Firms with higher levels of sales have both more positive and negative publicity, but the volume of positive stories is much higher. Attracting negative publicity is common for firms that achieve higher sales, but it is offset by a greater number of positive stories, an aspect that public relations efforts can influence. B2C advertising spending meanwhile matters more for firms with weaker rather than stronger existing corporate reputations. It is most effective for firms with weaker existing reputations to maximize the positive signals in the marketplace as exemplified by positive publicity and B2C advertising efforts.

Originality/value

Little research has examined the relationship between different forms of corporate communications and sales; this study is a rare examination using publicity, advertising spending, existing reputation and sales in a durable goods and services context where there has been a particular dearth of even basic advertising studies. Beyond understanding the relative importance of publicity v. advertising, it also uniquely focuses on the individual topics of news publicity.

Details

European Journal of Marketing, vol. 48 no. 11/12
Type: Research Article
ISSN: 0309-0566

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Article
Publication date: 1 December 2003

Peter A. Stanwick and Sarah D. Stanwick

This study examines the relationship between ethical reputation, CEO compensation and firm performance for the top corporate citizens as rated by Business Ethics magazine…

Abstract

This study examines the relationship between ethical reputation, CEO compensation and firm performance for the top corporate citizens as rated by Business Ethics magazine. The results show that there was not a direct relationship between CEO compensation and firm performance, that a high level of CEO compensation combined with a high ethical reputation did not impact the financial performance of the firm, and firms with a high ethical reputation had only average financial results, while firms with low ethical reputations displayed both high and low financial performance. Furthermore, CEOs of unfirms had, on average, higher compensation levels than firms that were profitable. These findings bring useful inputs for CEO on how they can justify high levels of compensation even during periods when the firm is not profitable or has a low level of profitability. An interesting sidelight of the study is that three CEOs in the sample whose firms were profitable did not accept any compensation during 2002, probably because the financial performance was below expectations.

Details

Management Decision, vol. 41 no. 10
Type: Research Article
ISSN: 0025-1747

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Article
Publication date: 29 November 2018

Sandeep Goel

The earnings management (EM) research on the impact of firm’s multi-nationality and reputation on the earnings’ quality is limited, particularly in the context of emerging…

Abstract

Purpose

The earnings management (EM) research on the impact of firm’s multi-nationality and reputation on the earnings’ quality is limited, particularly in the context of emerging economies like India. In India, the corporate ownership model is “Promoter-dominated shareholder model” wherein companies have global operations. The purpose of this paper is to analyze the EM practices of corporate enterprises in India about multi-nationality, reputation and related determinants.

Design/methodology/approach

The present study employs DeAngelo model for calculating discretionary accruals for detecting EM. Multi-nationality, reputation and related determinants are measured as accounting indices. The statistical tools applied for testing the accuracy of results include correlation and regression analysis, t-test and descriptive statistics, like arithmetic mean, median and standard deviation.

Findings

The results show that multi-nationality is the driving force for EM and significantly affects the accounting choices of management in the sample units. The firm’s reputation and other related determinants, except size, vary with accruals. The earnings behavior of the corporate is influenced by other factors, like growth and leverage as well.

Research limitations/implications

A total of 12 units out of top 25 units, taken for the study, met the sampling requirements. So, the present study is confined to 12 profit-making private listed companies in India. These companies constitute a significant size of BSE’s market capitalization for completeness of data; still the size and diversity of units can be extended for further study. The period in the study is of five years (2003–2004 to 2007–2008) to find the effects of global recession on EM practices in India. Researchers may like to select a different time-period based on their objective.

Practical implications

The study draws new dimensions about the quality of financial reporting in case of global firms and with high-perceived reputation. The findings are of significance to standard setters and regulators, particularly for emerging economies, like India where companies have international operations. They are equally important for other companies that are based in economies with relatively mature corporate governance mechanisms because of common regulatory focal points.

Social implications

It brings out the importance of financial reporting process of global corporations for shareholders’ value creation. It is likely to enrich the knowledge and understanding of the EM phenomenon in developing economies like India.

Originality/value

It is an original paper, which highlights the EM motivation about multi-nationality, reputation and related variables in Indian corporate.

Details

International Journal of Emerging Markets, vol. 13 no. 6
Type: Research Article
ISSN: 1746-8809

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Article
Publication date: 7 November 2016

Peng Wu, Lei Gao and Xiao Li

This paper aims to investigate the relationship between earnings management and media reports, assess the roles played by the media in determining the reputation mechanism…

Abstract

Purpose

This paper aims to investigate the relationship between earnings management and media reports, assess the roles played by the media in determining the reputation mechanism and examine whether the media has an influence on executives’ behavior in the case of earnings management.

Design/methodology/approach

This paper uses Chinese A-share listed firms from the period 2008 to 2012 to test the research questions using regression analyses.

Findings

Although the Chinese Stock Markets are still immature compared to those of developed countries, the media seems to play a role in affecting executives’ decisions about dabbling in earnings management. Specifically, firms receiving more media attention are more likely to undertake earnings management. Furthermore, negative media reports result in even higher levels of earnings management activities, indicating that managers tend to use earnings management to achieve earnings goals to reduce or relieve the pressure they feel from the media and to remedy any reputation loss. Moreover, the authors have found that firms whose CEOs have higher reputations are more likely to manage earnings and they are more likely to be affected by negative media reports. Similar results were found for state-owned enterprises (SOEs).

Originality/value

This study analyzes how the level and tone of media coverage affect earnings management rather than just assessing the overall effect of media coverage on earnings management. This paper verifies that the reputation mechanism of the media works in China, but it leads to different results than those experienced in developed countries. Reputational benefits have been introduced into the equation for measuring the governance effect of the media to derive a more in-depth analysis of the reputation mechanism. This paper is among the first to link news coverage and state ownership with earnings management.

Details

Chinese Management Studies, vol. 10 no. 4
Type: Research Article
ISSN: 1750-614X

Keywords

Content available
Article
Publication date: 30 September 2019

Aleixo Fernandes, Marcelo Moll Brandao, Evandro Luiz Lopes and Filipe Quevedo-Silva

The purpose of this paper is to identify the influence of the company’s reputation and individual consumer involvement in the relationship between satisfaction, loyalty…

Abstract

Purpose

The purpose of this paper is to identify the influence of the company’s reputation and individual consumer involvement in the relationship between satisfaction, loyalty and willingness to pay more for a product.

Design/methodology/approach

The method used is quantitative, by means of a survey with real consumers of automotive services of two vehicle dealerships, whose data were analyzed through linear regression analysis and conditional analysis of moderation.

Findings

The authors have identified that the relationship between satisfaction and loyalty and between loyalty and willingness to pay more for a product is entirely moderated by the (high) reputation of the brand and the (high) individual involvement of the consumer.

Practical implications

The study contributes to marketing managers as it demonstrates effect of brand reputation and involvement. Therefore, it is understood that these variables need to be considered in satisfaction surveys, as it has been proven that satisfaction alone cannot explain the variables of business performance (loyalty and willingness to pay).

Originality/value

The greatest innovation of this study is the identification of the total moderation between stated satisfaction and loyalty and between satisfaction and willingness to pay more. It has been demonstrated that high levels of brand reputation coupled with high levels of consumer involvement account for the fully dependent variables.

Details

RAUSP Management Journal, vol. 55 no. 1
Type: Research Article
ISSN: 2531-0488

Keywords

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