IDEAS home Printed from https://ideas.repec.org/a/eee/jbrese/v203y2026ics0148296325006411.html

Inherent and acquired disorder and their effects on misconduct

Author

Listed:
  • Schnatterly, Karen
  • Clark, Brent
  • Moake, Timothy R.

Abstract

Misconduct is often the result of disorder in the firm. Disorder exists when organizational routines, processes, or mechanisms fail to fulfill their intended purposes. Social disorganization theory argues that “places”, such as neighborhoods and firms, experience persistent problems due to a lack of formal and informal controls. In this paper, we examine two disorder-creating potential antecedents of financial misconduct: previous misconduct and merger and acquisition (M&A) integration. These two events each indicate a type of disorder in the firm (inherent or acquired), which paves the way for future misconduct. Our results indicate that inherent disorder and acquired disorder jointly lead to future misconduct. These results highlight that organizations with broken internal systems are more likely to experience future misconduct and that M&A activity amplifies this effect.

Suggested Citation

  • Schnatterly, Karen & Clark, Brent & Moake, Timothy R., 2026. "Inherent and acquired disorder and their effects on misconduct," Journal of Business Research, Elsevier, vol. 203(C).
    • Handle: RePEc:eee:jbrese:v:203:y:2026:i:c:s0148296325006411
    DOI: 10.1016/j.jbusres.2025.115818
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0148296325006411
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.jbusres.2025.115818?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to

    for a different version of it.

    References listed on IDEAS

    as
    1. Abhirup Chakrabarti & Will Mitchell, 2016. "The role of geographic distance in completing related acquisitions: Evidence from U.S. chemical manufacturers," Strategic Management Journal, Wiley Blackwell, vol. 37(4), pages 673-694, April.
    2. Andrea Mariani & Antonella Cifalinò & Irene Eleonora Lisi & Marco Giovanni Rizzo, 2024. "Management accounting change in merger and acquisitions: a multiple-case study," Journal of Accounting & Organizational Change, Emerald Group Publishing Limited, vol. 20(6), pages 252-276, October.
    3. Karen Schnatterly, 2003. "Increasing firm value through detection and prevention of white‐collar crime," Strategic Management Journal, Wiley Blackwell, vol. 24(7), pages 587-614, July.
    4. Yong Li & Ruth V. Aguilera, 2008. "Target Director Turnover in Acquisitions: A Conceptual Framework," Corporate Governance: An International Review, Wiley Blackwell, vol. 16(6), pages 492-503, November.
    5. Donald S. Siegel & Kenneth L. Simons, 2010. "Assessing the effects of mergers and acquisitions on firm performance, plant productivity, and workers: newl evidence from matched employer‐employee data," Strategic Management Journal, Wiley Blackwell, vol. 31(8), pages 903-916, August.
    6. Abhijeet K. Vadera & Michael G. Pratt, 2013. "Love, Hate, Ambivalence, or Indifference? A Conceptual Examination of Workplace Crimes and Organizational Identification," Organization Science, INFORMS, vol. 24(1), pages 172-188, February.
    7. Xin Xu & Feng Xiong & Zhe An, 2023. "Using Machine Learning to Predict Corporate Fraud: Evidence Based on the GONE Framework," Journal of Business Ethics, Springer, vol. 186(1), pages 137-158, August.
    8. Fama, Eugene F, 1980. "Agency Problems and the Theory of the Firm," Journal of Political Economy, University of Chicago Press, vol. 88(2), pages 288-307, April.
    9. Benjamin E. Hermalin & Michael S. Weisbach, 1991. "The Effects of Board Composition and Direct Incentives on Firm Performance," Financial Management, Financial Management Association, vol. 20(4), Winter.
    10. Wallace N. Davidson & Sameh Sakr & Yixi Ning, 2004. "Competition For Board Seats Following Stock‐For‐Stock Mergers," Journal of Financial Research, Southern Finance Association;Southwestern Finance Association, vol. 27(1), pages 55-73, March.
    11. Srikanth Paruchuri & Atul Nerkar & Donald C. Hambrick, 2006. "Acquisition Integration and Productivity Losses in the Technical Core: Disruption of Inventors in Acquired Companies," Organization Science, INFORMS, vol. 17(5), pages 545-562, October.
    12. repec:hal:journl:hal-02311973 is not listed on IDEAS
    13. Annette L. Ranft & Michael D. Lord, 2002. "Acquiring New Technologies and Capabilities: A Grounded Model of Acquisition Implementation," Organization Science, INFORMS, vol. 13(4), pages 420-441, August.
    14. Rikard Larsson & Sydney Finkelstein, 1999. "Integrating Strategic, Organizational, and Human Resource Perspectives on Mergers and Acquisitions: A Case Survey of Synergy Realization," Organization Science, INFORMS, vol. 10(1), pages 1-26, February.
    15. Melissa E. Graebner & Koen H. Heimeriks & Quy Nguyen Huy & Eero Vaara, 2017. "The Process of Postmerger Integration : A Review and Agenda for Future Research," Post-Print hal-02276670, HAL.
    16. Li, Yong & Aguilera, Ruth V., 2008. "Target Director Turnover in Acquisitions: A Conceptual Framework," Working Papers 08-0106, University of Illinois at Urbana-Champaign, College of Business.
    17. Anke Arnaud & Marshall Schminke, 2012. "The Ethical Climate and Context of Organizations: A Comprehensive Model," Organization Science, INFORMS, vol. 23(6), pages 1767-1780, December.
    18. Jensen, Michael C & Murphy, Kevin J, 1990. "Performance Pay and Top-Management Incentives," Journal of Political Economy, University of Chicago Press, vol. 98(2), pages 225-264, April.
    19. Sarala, Riikka M. & Vaara, Eero & Junni, Paulina, 2019. "Beyond merger syndrome and cultural differences: New avenues for research on the “human side” of global mergers and acquisitions (M&As)," Journal of World Business, Elsevier, vol. 54(4), pages 307-321.
    20. Riikka M. Sarala & Eero Vaara & Paulina Junni, 2019. "Beyond merger syndrome and cultural differences : New avenues for research on the “human side” of global mergers and acquisitions (M&As)," Post-Print hal-02312088, HAL.
    21. Khanna, Poonam & Khan, Sarfraz A. & Krasikova, Dina & Miller, Stewart R., 2021. "Repeated engagement in misconduct by executives involved with financial restatements," Organizational Behavior and Human Decision Processes, Elsevier, vol. 166(C), pages 194-203.
    22. Michael D. Pfarrer & Ken G. Smith & Kathryn M. Bartol & Dmitry M. Khanin & Xiaomeng Zhang, 2008. "Coming Forward: The Effects of Social and Regulatory Forces on the Voluntary Restatement of Earnings Subsequent to Wrongdoing," Organization Science, INFORMS, vol. 19(3), pages 386-403, June.
    23. Alexander, Cindy R. & Cohen, Mark A., 1999. "Why do corporations become criminals? Ownership, hidden actions, and crime as an agency cost," Journal of Corporate Finance, Elsevier, vol. 5(1), pages 1-34, March.
    24. Brian K. Boyd, 1995. "CEO duality and firm performance: A contingency model," Strategic Management Journal, Wiley Blackwell, vol. 16(4), pages 301-312.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Wang, Daojuan & Hain, Daniel S. & Larimo, Jorma & Dao, Li T., 2020. "Cultural differences and synergy realization in cross-border acquisitions," International Business Review, Elsevier, vol. 29(3).
    2. Ai, Qi & Tan, Hui, 2020. "Uncovering neglected success factors in post-acquisition reverse capability transfer: Evidence from Chinese multinational corporations in Europe," Journal of World Business, Elsevier, vol. 55(3).
    3. Naeem Tabassum & Satwinder Singh, 2020. "Corporate Governance and Organisational Performance," Springer Books, Springer, number 978-3-030-48527-6, January.
    4. Colman, Helene Loe, 2020. "Facilitating integration and maintaining autonomy: The role of managerial action and interaction in post-acquisition cabability transfer," Journal of Business Research, Elsevier, vol. 109(C), pages 148-160.
    5. Christopher B. Bingham & Koen H. Heimeriks & Philipp Meyer-Doyle, 2024. "How Firms Cultivate Collaboration During Postmerger Integration of Technology Acquisitions," Strategy Science, INFORMS, vol. 9(2), pages 205-228, June.
    6. Meglio, Olimpia, 2022. "Reshaping M&A research: Strategies and tactics for a new research agenda," European Management Journal, Elsevier, vol. 40(6), pages 823-831.
    7. Datta, Deepak K. & Basuil, Dynah A. & Agarwal, Ankita, 2020. "Effects of board characteristics on post-acquisition performance: A study of cross-border acquisitions by firms in the manufacturing sector," International Business Review, Elsevier, vol. 29(3).
    8. Sears, Joshua B. & Hitt, Michael A., 2023. "Post-acquisition integrative invention and differences in the quality of target and acquirer technological capabilities," Journal of Business Research, Elsevier, vol. 156(C).
    9. Maureen Muller-Kahle, 2015. "The impact of dominant ownership: the case of Anglo-American firms," Journal of Management & Governance, Springer;Accademia Italiana di Economia Aziendale (AIDEA), vol. 19(1), pages 71-89, February.
    10. Helene Loe Colman & Audrey Rouzies, 2018. "Postacquisition Boundary Spanning: A Relational Perspective on Integration," Post-Print hal-03279605, HAL.
    11. David R. Williams & Betty S. Coffey & Carlton C. Young, 2018. "Human capital and agency effects on CEO compensation of IPO biopharmaceutical firms and the market’s response," Journal of Management & Governance, Springer;Accademia Italiana di Economia Aziendale (AIDEA), vol. 22(2), pages 315-337, June.
    12. Barwinski, Roman W. & King, David R. & Chaturvedi, Tuhin & Bauer, Florian, 2025. "When does acquisition experience recency matter?," Journal of Business Research, Elsevier, vol. 201(C).
    13. Devarakonda, S.V. & Goossen, Martin & Mulotte, Louis, 2024. "The allocation of resource control within the corporate structure: Evidence from post-acquisition patent reassignments," Other publications TiSEM 4e9af8a0-0e1c-4780-a24e-6, Tilburg University, School of Economics and Management.
    14. Otten, Jordan J.A. & Heugens, Pursey P.M.A.R, 2007. "Extending the managerial power theory of executive pay: A cross national test," MPRA Paper 6778, University Library of Munich, Germany.
    15. Bauer, Florian & King, David & Matzler, Kurt, 2016. "Speed of acquisition integration: Separating the role of human and task integration," Scandinavian Journal of Management, Elsevier, vol. 32(3), pages 150-165.
    16. ATM Adnan & Nisar Ahmed, 2019. "The Transformation Of The Corporate Governance Model: A Literature Review," Copernican Journal of Finance & Accounting, Uniwersytet Mikolaja Kopernika, vol. 8(3), pages 7-47.
    17. Wilson Ezi Herbert & ThankGod C. Agwor, 2025. "Board Composition and Corporate Performance: X-raying the Nexus in Nigerian Banks," Global Business Review, International Management Institute, vol. 26(5), pages 1135-1166, October.
    18. Christofi, Michael & Vrontis, Demetris & Thrassou, Alkis & Shams, S.M. Riad, 2019. "Triggering technological innovation through cross-border mergers and acquisitions: A micro-foundational perspective," Technological Forecasting and Social Change, Elsevier, vol. 146(C), pages 148-166.
    19. Katrin Hussinger, 2012. "Absorptive capacity and post-acquisition inventor productivity," The Journal of Technology Transfer, Springer, vol. 37(4), pages 490-507, August.
    20. Chiraz Ben Ali & Frederic Teulon, 2014. "CEO Monitoring and board effectiveness: Resolving CEO compensation issue," Working Papers 2014-45, Department of Research, Ipag Business School.

    More about this item

    Keywords

    ;
    ;
    ;
    ;
    ;
    ;

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:jbrese:v:203:y:2026:i:c:s0148296325006411. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/jbusres .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.