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When Corporate Social Responsibility Backfires: Evidence from a Natural Field Experiment

Author

Listed:
  • John A. List

    (Department of Economics, University of Chicago, Chicago, Illinois 60637)

  • Fatemeh Momeni

    (Department of Economics, University of Chicago, Chicago, Illinois 60637)

Abstract

This paper uses a natural field experiment to connect corporate social responsibility (CSR) to an important but often neglected behavior: employee misconduct and shirking. Through employing more than 1,500 workers, we find that our use of CSR increases employee misbehavior—24% more employees act detrimentally toward our firm by shirking on their primary job duties when we introduce CSR. Observed data patterns across the treatments are consonant with a model of “moral licensing,” whereby the “doing good” nature of CSR induces workers to misbehave on another dimension that is harmful to the firm.

Suggested Citation

  • John A. List & Fatemeh Momeni, 2021. "When Corporate Social Responsibility Backfires: Evidence from a Natural Field Experiment," Management Science, INFORMS, vol. 67(1), pages 8-21, January.
    • Handle: RePEc:inm:ormnsc:v:67:y:2021:i:1:p:8-21
    DOI: 10.1287/mnsc.2019.3540
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    References listed on IDEAS

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    Full references (including those not matched with items on IDEAS)

    Citations

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    Cited by:

    1. Philipp Dörrenberg & Christoph Feldhaus, 2022. "How Does Group-Decision Making Affect Subsequent Individual Behavior?," CESifo Working Paper Series 9513, CESifo.
    2. Au, Pak Hung & Li, King King & Zhang, Qing & Zhu, Rong, 2023. "The Hidden Costs of Choice in the Labor Market," IZA Discussion Papers 16623, Institute of Labor Economics (IZA).
    3. Ruiqian Xu & Jinchen Liu & Dongning Yang, 2023. "The Formation of Reputation in CSR Disclosure: The Role of Signal Transmission and Sensemaking Processes of Stakeholders," Sustainability, MDPI, vol. 15(12), pages 1-19, June.
    4. Hsu, Bo-Xiang & Chen, Yi-Min & Chen, Li-An (Leann), 2022. "Corporate social responsibility and value added in the supply chain: Model and mechanism," Technological Forecasting and Social Change, Elsevier, vol. 174(C).
    5. Non, Arjan & Rohde, Ingrid & de Grip, Andries & Dohmen, Thomas, 2022. "Mission of the company, prosocial attitudes and job preferences: A discrete choice experiment," Labour Economics, Elsevier, vol. 74(C).
    6. Xie, Yibo & Ma, Wenbin & Ma, Yichuan & Ren, Zhouqi & Tong, Zelin & Wang, Yihuan, 2023. "A counterfactual thinking perspective of moral licensing effect in machine-driven communication: An example of natural language processing chatbot developed based on WeChat API," Technological Forecasting and Social Change, Elsevier, vol. 197(C).
    7. Zhu, Minghao & Yeung, Andy C.L. & Zhou, Honggeng, 2021. "Diversify or concentrate: The impact of customer concentration on corporate social responsibility," International Journal of Production Economics, Elsevier, vol. 240(C).
    8. Raja Rajendra Timilsina & Koji Kotani & Yoshinori Nakagawa & Tatsuyoshi Saijo, 2023. "Does Being Intergenerationally Accountable Resolve the Intergenerational Sustainability Dilemma?," Land Economics, University of Wisconsin Press, vol. 99(4), pages 644-667.
    9. Cook, Nikolai & Heyes, Anthony, 2022. "Pollution pictures: Psychological exposure to pollution impacts worker productivity in a large-scale field experiment," Journal of Environmental Economics and Management, Elsevier, vol. 114(C).
    10. Tomomi Yamane & Shinji Kaneko, 2021. "What Motivates Stakeholders to Demand Corporate Social Responsibility: A Survey Experiment," Sustainability, MDPI, vol. 13(15), pages 1-15, July.
    11. Song, Fenghua & Thakor, Anjan & Quinn, Robert, 2023. "Purpose, profit and social pressure," Journal of Financial Intermediation, Elsevier, vol. 55(C).
    12. Adena, Maja & Huck, Steffen, 2019. "Can mass fundraising harm your core business? A field experiment on how fundraising affects ticket sales," Discussion Papers, Research Unit: Economics of Change SP II 2019-304, WZB Berlin Social Science Center.
    13. Chenyu Shan & Dragon Yongjun Tang, 2023. "The Value of Employee Satisfaction in Disastrous Times: Evidence from COVID-19," Review of Finance, European Finance Association, vol. 27(3), pages 1027-1076.
    14. Hsu, Bo-Xiang & Chen, Yi-Min, 2023. "The relationship between corporate social responsibility, external orientation, and environmental performance," Technological Forecasting and Social Change, Elsevier, vol. 188(C).
    15. Chunfeng Dong & Jun He & Longzheng Du & Jing Yang, 2023. "Executives with Environmental Experience and Corporate Environmental Performance: Evidence from China’s A-Share Listed Companies," Sustainability, MDPI, vol. 15(20), pages 1-22, October.
    16. Laszlo Goerke & Nora Paulus, 2024. "Collective Bargaining about Corporate Social Responsibility," IAAEU Discussion Papers 202401, Institute of Labour Law and Industrial Relations in the European Union (IAAEU).

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