R E S E A R C H

Public Enemies? The Differential Effects of Reputation and Celebrity on Coporate Misconduct Scandalization. Strategic Management Journal, forthcoming.

with Tim Pollock and Srikanth Paruchuri

We explore misconduct scandalization’s antecedents by focusing on the rational and emotional bases underlying reputation and celebrity, and considering how they can enhance or reducethe likelihood misconduct is scandalized as a function of the misconduct’s objective and perceived severity. Specifically, we argue the quantifiable nature of objective misconduct severity enhances reputation’s rational influence, but attenuates celebrity’s emotion-based appeal. Conversely, perceived misconduct severity reduces reputation’s influence, while enhancing the media-driven interest in celebrity firms’ behaviors. Our findings based on corporate data breaches confirm that objective severity amplifies reputation’s effect and attenuates celebrity’s effect, while perceived severity amplifies celebrity’s effect and attenuates reputation’s effect. Our findings highlight the importance of social evaluations’ sociocognitive content in understanding why only some misconduct becomes scandalized.

Managerial Summary. Committing misconduct is costly; having it scandalized is devastating. Yet little is known about how social evaluations influence why only some firms’ misconduct is scandalized, beyond the vague notion that prominent firms’ misconduct attracts media attention. We find that the rational and emotional bases of firms’ evaluations matter. High reputation, based on the rational assessment of firms’ capabilities, increases the likelihood of scandalization for objectively severe misconduct, and the influence of celebrity—originating from audiences’ emotional resonance with firms’ unconventional traits and behaviors—weakens as objective severity increases. Conversely, reputation’s influence weakens, and celebrity’s influence strengthens, as media “availability cascades” grow and increase perceived severity. In addition to providing a more realistic portrayal of media behavior, we offer insights into post-misconduct communications and remedial actions. (full text PDF)

Now You See Me: How Status and Categorical Proximity Shape Misconduct Scandalization. Academy of Management Journal, 67(1): 208-231.

with Tim Pollock and Scott Graffin

Despite the formidable consequences for firms of having their misconduct publicized—and thus scandalized—we know little about why only some misconduct instances become scandals beyond the idea that high-status firms’ transgressions are scandalized more often. Focusing on the media’s essential role in scandalizing misconduct, we take a media routines perspective to theorize how the status of past transgressors inside and outside the focal transgressor’s industry creates different contexts that shape the likelihood of scandalization. We argue that the prevalence of past transgressions by high-status firms within the industry leads journalists to scrutinize the misconduct more, amplifying the effect of the focal firm’s status by highlighting its commonalities with past transgressors. Conversely, the prevalence of transgressions by high-status firms outside the industry attenuates the firm status effect on scandalization by directing media attention outside the industry, limiting the information that can be inferred from firm status. Past transgressors’ status and their categorical proximity to current transgressors serve as boundary conditions for the scandalizing effect of status. Our contribution lies in elucidating contextual factors that influence how status acts as an antecedent of scandals, and explaining how status and categories feed media routines that influence the likelihood of firm misconduct being scandalized. (full text PDF)

*Tim Pollock discusses this paper in a podcast (Link)

*This article was featured in LSE Business Review of the London School of Economics and Political Science (Link) and also in AOM Insights (Link)

Goofus or Gallant? An Attribution-Based Theory of Misconduct Spillover Valence. Research in the Sociology of Organizations, 85: 35-51.

with Tim Pollock and Srikanth Paruchuri

Despite growing interest in misconduct spillovers—where unimplicated bystanders’ stock prices, reputations, resources, and opportunities are positively or negatively affected by others’ misconduct—theory about spillovers’ antecedents has largely focused on industry or product similarity, and has used the same characteristics to argue for both positive and negative spillovers. Further, limited research has considered both positive and negative spillovers together, instead focusing on one kind of spillover or the other in isolation, thereby creating a lack of theoretical integration within the literature. In this paper we draw on attribution theory and expectancy violations theory to explain when and how misconduct incurs positive and negative spillovers. We argue that a spillover’s valence depends on the locus of attributions made by stakeholders, where the misconduct’s causes are attributed to the perpetrator alone (i.e., an isolated attribution)—resulting in positive spillovers—or the misconduct’s causes are perceived as indicative of a systemic problem shared among a broader set of organizations (i.e., a systemic attribution), leading to negative spillovers. We further suggest that the misconduct’s nature and misconduct prevalence within a perpetrator and among other firms influences stakeholders’ attributions, and ultimately the spillover’s valence. Our theory contributes to the organizational misconduct literature by providing a unifying theoretical framework to understand both positive and negative spillovers. (full text PDF)

Salient Expectations? Incongruence Across Capability and Integrity Signals and Investor Reactions to Organizational Misconduct. Academy of Management Journal, 64(2): 562-586.

with Srikanth Paruchuri and Puneet Prakash

Research in signaling theory has recently begun to explore the consequences of incongruence across signals from a single source. However, the attention has been directed towards the incongruence across signals along a single dimension. Considering that audiences evaluate firms based on signals of different dimensions, we extend this theory to investigate the incongruence across these signals of different dimensions. Specifically, we theorize that the salience of positive capability signals at the time of the revelation of organizational misconduct, a negative integrity signal, causes interdimensional incongruity. We argue that audiences will face greater incongruence and react more negatively to the misconduct events to the extent that a firm’s positive capability signal was salient. Our findings using irregular financial restatements as the negative integrity signals that cause incongruence with alliance announcements, a positive capability signal, indicate that investors reacted more negatively to the restatements by firms that had higher salience of alliance announcements: firms that announced more frequently and firms that created more positive expectations from those announcements were penalized more. We also found that firm size and diversification weakened these negative effects. We contribute to research on signaling theory, organizational misconduct, and alliances. (full text PDF)

*This article was featured in the Management Matters magazine published by the Trulaske College of Business, University of Missouri (Link)

The Two Towers (or Somewhere in Between): The Behavioral Consequences of Positional Inconsistency Across Status Hierarchies. Academy of Management Journal, 64(1): 86-113.

with Tim Pollock

We examine how actors react to status inconsistencies across multiple status hierarchies. We argue that pluralistic value systems create multiple status conferral mechanisms, and that hierarchies’ prestige varies as a function of the values they represent. While status inconsistency, in general, increases the likelihood that actors will pursue opportunities that can boost their lagging status, their status hierarchies’ unequal prestige influences the magnitude and direction of actors’ responses to their status inconsistency. Further, their ability to do so is constrained by their relative standing in their primary status hierarchy and the extent to which they are embedded in particular professional networks. Using the artistic and commercial status of Hollywood performers, we found that status-inconsistent performers were more likely to appear in films that could boost their lagging status in the commercial hierarchy when they possessed relatively higher artistic than commercial status. Moreover, being high-status decreased the likelihood a performer would pursue opportunities that could improve their lagging status only when they were high status in the artistic status hierarchy, while embeddedness only decreased the likelihood when their primary status hierarchy was commercial. (full text PDF)

Which of These Things are Not Like the Others? Comparing the Rational, Emotional and Moral Aspects of Reputation, Status, Celebrity and Stigma. Academy of Management Annals, 13(2): 444-478.

with Tim Pollock, Kisha Lashley, and Violina Rindova

In this review of the literature on reputation, status, celebrity and stigma we develop an overarching theoretical framework based on the rational, emotional and moral aspects of each construct’s unique sociocognitive content, and the mechanisms through which it affects audience evaluations. We use this framework to assess the construct definitions and empirical measures employed in current research, and offer our assessments of how well they reflect each construct’s sociocognitive content, distinguish the constructs from other constructs, and distinguish the constructs from their antecedents and consequences. We then articulate the implications of our framework and analyses for future research. (full text PDF)

Jung-Hoon Han’s Website
Inquiries: junghoonhan@skku.edu