Introduction: Organizational Wrongdoing as the “Foundational” Grand Challenge: Definitions and Antecedents

Abstract Organizational wrongdoing is still very much prevalent in today’s society. Traditional and social media are full of examples organizations engaging unethical or illegal behavior. While it difficult – if not impossible to establish whether the ever-increasing number reported cases due an actual increase phenomenon (objectivist view wrongdoing) more attention being paid (social-constructivist wrongdoing), fact remains that organizational seems have become norm rather than exception our everyday life. This concerning, as tends undermine trust fundamental institutions, such Market, State, Religion, Law, may lead them replaced by other sometimes less desirable institutions create “institutional void.” Because its potential impact on established deserves be closely monitored further examined. volume Research Sociology Organizations attempt draw theoretical empirical relevance topic, consolidate extend knowledge accumulated this area research, highlight direction for future research. The explores particular definitions antecedents wrongdoing. Keywords Misconduct Scandals Corruption Unethical behavior Grand challenge Social evaluation Citation Gabbioneta, C., Clemente, M. Greenwood, R. (2023), "Introduction: Wrongdoing “Foundational” Challenge: Definitions Antecedents", (Ed.) Antecedents (Research Organizations, Vol. 84), Emerald Publishing Limited, Bingley, pp. 1-11. https://doi.org/10.1108/S0733-558X20230000084013 Publisher: Limited Copyright © 2023 Claudia Marco Clemente Royston Greenwood Introduction In 2021, opening pages a newspaper, one could keep up with frequency reports organizations. March, U.K. Financial Reporting Council (FRC) commenced investigation into Deloitte over audit work car dealership chain Lookers years 2017 2018.1 became part Conduct Authority (FCA), allegations fraud black holes Lookers’ accounts. Although FCA subsequently dropped investigation, FRC decided carry out Deloitte’s work. effect, was implicitly probing role protector market system. July same year, both former chief executive officer financial telecommunications company FTE Networks were arrested charged accounting among series crimes, including embezzling millions dollars from pay private jet use, luxury automobiles, personal credit cards, unauthorized wire transfer, stock issuances, salary increases.2 September Securities Exchange Commission fined New York City-based telecom Pareteum Corp. $500,000 overstating revenue approximately $42 million six quarters providing false information auditors.3 month, Kraft Heinz agreed $62 settlement improper led restatement several reporting, and, December, Peter Armbruster trucking logistics Roadrunner Transportation Systems convicted his complex securities scheme.4 above just few companies been investigated found guilty misbehaviors within months. Such wrongdoings novel (Cooper et al., 2013): Enron (e.g., Arnold & de Lange, 2004; Coffee, 2001; Fox, 2003; Healy Palepu, McLean Elkind, 2013; Unerman 2004) Parmalat Ferrarini Giudici, 2006; Gabbioneta Melis, 2005) infamous earlier examples. But they do seem attracting considerable growing attention. Other venues forms also spotlight receiving significant coverage internationally, Weinstein Epstein scandals Roman Catholic Church’s abusive treatment indigenous children residential schools, cite few. Implications Institutional Trust It conclusively instances seemingly list outcome interest sharper ability uncover expose behaviors. As unreported difficult, impossible, observe, main source can upon (Roulet 2018, 2016, Roulet Pichler, 2020). media, however, offer objective, impartial representation events (Clemente 2017). Rather, framing event instance wrongdoing, act control agents (Greve 2010, Palmer, 2012), separating rightful wrongful contributing categorization However, frequencies construction (social constructivist irreparably Law (on point, see Lounsbury, 2023). These foundation society, enable function survive. If faith these erodes, other, alternatives (Zucker, 1986). For example, Italy second half nineteenth century, lack newly formed State absence central government at local level repeated episodes corruption associated emergence development various criminal Cosa Nostra Sicily, ’Ndrangheta Calabria, Camorra Campania) seemed answer problems uncertainties experienced population time (Dickie, 2004). Similarly, sex hit Church United States elsewhere resulted loss institution sharp decrease members, some which moved away religion whole joined extreme congregations (Piazza Jourdan, 2018). Or, again, functioning aftermath wave taking place turn only most egregious examples, followed resurgence barter generally, non-market-based exchange Goff, 2009; Marin Schnitzer, 2002). Moreover, becomes widespread, might used justify populist even violent challenges taken-for-granted norms behaviors, constitute pillars consequences words, profoundly disruptive. Furthermore, scholarly directed toward grand challenges, climate change, inequality, sustainability, multiple calls scholars study Sustainable Development Goals (George 2016), we should forget solving (Castro 2020) “foundational” underlies many others. UN puts it, “acting against imperative achieving recently adopted Goals, aim end poverty, protect planet, ensure prosperity all, amongst others” (UNDOC, Hence, motivation directions discuss below. volume, Antecedents, includes 12 papers focuses definition studies recent has accompanied proliferation definitions. widespread cited offered Greve al. (2010), who define organization social-control agent judges transgress line right wrong; where separate legal, ethical, socially responsible their antitheses. (p. 56) highlights constructed nature points defining, identifying, sanctioning Control Agents first three probe drawing between assessing trespassed line. “actors represent collectivity impose sanctions collectivity’s behalf” p. 56). Examples include regulators, professional associations, media. acknowledged identification punishment examined how exercise differentiate “right wrong.” Volume look issue shed new light processes mechanisms agents. Cappellaro, Compagni, Vaara examine show change time. Authors analyze Italian state actors categorized behaviors so-called “gray area,” i.e., conduct individuals supportive mafia aims, but members organization. Cappellaro document started preliminary stigmatize question moral grounds, ultimately criminalized legal sanctions. They identify principles behind evolving definition: first, “intentionality conduct,” extent consciously support Nostra; second, “freedom choice,” forced it; third, “scope harm,” By showing provided evolve time, identifying possible explanations changes, contribute debate active constructionist Roulet, Paolella add independent assessment (in case, government) affects media). 2008 bailout investment banks attenuate negative severing tie brings back evaluations. results point interdependency judgment what constitutes doing so, illuminate affect way assess Fiorito, Hoff, Ehrenhard unveil another mechanism influences agents: namely, occurrence fieldwide critical events, introduction regulations. investigate why redirect agents’ prompt action, while others not. Using case regulatory agency’s actions violations anti-money laundering regulations European 16-year period, categories events: “constraining events,” “conducive “clustered events.” Constraining significantly restrict identified violations. Conducive Clustered ingrained beliefs spring action. perspective previous section elaborated next focus different accounts process and/or dynamics them. originate alleged there exacerbating effect hence, important grasp emerge develop. scandal, fact, must “known (…) sufficiently serious elicit public response” (Thompson, 2000, 13). arise, therefore, publicity then produces powerful externalities (Adut, 2005). Understanding scandal is, thus, utmost importance. study, Jourdan adopts approach usual discrete proposing better understood interactional disclosure misconducts involve following elements: (a) struggle perpetrators misconduct; (b) moralizing audience members; (c) collective effervescence societal level; (d) rewriting rules applicable members. According interactions perpetrators, agents, take publicly backdrop implicit code delineates prohibited given context thus amenable framed scandalous Dewan Jensen concept “scandal dynamics.” distinguish single-actor scandals, result misconduct single actor, multiple-actor similar type actors, develop framework draws distinction start (single-actor multiple-actor) multiple-actor). Doing so differentiates spillover (from actors) scapegoating identifies likelihood two types occur: “defection,” “traceability,” “inferencing,” “intensity,” “cohesion.” explain lend additional dynamic comprising actors. Maier Lamargot explore framings Their analysis frames English French Press involving SNC-Lavalin, Quebec-based multinational engineering firm. findings outlets shifted balanced nuanced facilitated debates appropriate selective (re)construction order serve partisan agendas when company’s plight politicized. unveiling politicization dual opinion across Press, complements paper enhance understanding processual nature. remaining Prior research already unveiled multiplicity individual, organizational, field (Gabbioneta 2013, Muzio 2016). uncovered far, always fully prompting need considers explored, antecedents. Roman, Naumovska, Haleblian largely overlooked antecedent individual-level: childhood class CEO. Building sociology psychology demonstrates impacts adult behavior, influence predictor white-collar corporate crime. argument raised middle-class families greater disposition commit crimes because leaves lasting status-anxiety imprint, increases tendency engage crime preserve status. hypothesize status-anxiety-minimizing factors Ivy League education membership prominent golf club would weaken upbringing confirm predictions, find firms CEOs grow likely compared low- high-class families, negatively moderate relationship individual-level evidence new, understudied cause Coppins Weststar wrongdoing: occupation. build identity theory argue strongly benefits organization, (i.e., pro-organizational hereafter UPB). A strong occupational identification, contrary, expected mitigate desire UPB. Utilizing sample 236 accountants professionals, alone predict UPB, interaction does. positively predicts UPB extremely low strength. Fey Amis complement looking organizational-level intraorganizational boundaries. ways boundaries Volkswagen before “Dieselgate” internal defined “in” “out” groups, normalized certain limited communication This, turn, allowed go unchallenged. suggest combination cognitive, horizontal, vertical infrastructure design permits prevents challenged, normalizes activities. Authors, Hensel Makowski multilevel employees bureaucratic strategically use references procedures routines discourage clients turning help assistance. form (Palmer, materialize large organizations, monitor employees, performance measurement systems. individual stress burnout, job dissatisfaction, traits Machiavellianism, psychopathy, narcissism bureaucrats’ side, poor system communicate, clients’ side. Collectively, elements make assistance establishment maintaining those vulnerable services least apply for, receive, Andiappan Dufour delve field-level gender-based discrimination occupation persist despite changes technological innovations intended increasingly accessible women. data collected 72 interviews retired longshoremen employers, supplemented archival observational data, that, although women permitted longshore beginning period observation (1947 1960s), progressively completely excluded. Longshoremen rationalized exclusion utilizing paradigms self-serving justifications. justification strategies consistently observed throughout content changed reflect importance persistent changing environmental conditions. Occupational Bento, White, Antonacopoulou. unresponsiveness Internal Audit (IA) amid signs arising spreading explained auditors’ myopic interpretation classic tenets auditing (scope, compliance, materiality). initially created prevent happening, unwittingly undetected lengthy periods. challenging key assumptions failed application warns oversimplified understandings reassuring idea strict happening. Future Directions enhancing contributions needs done. One makes act. Whether produce effects open question. “tipping point” after trigger wrong, judgment. higher consequence categorize Perceptions refer are, subjective affected factors. therefore is: judge causing great harm consequence, wrongdoing? mutual reciprocal dependencies socio-constructivist recognized each 2010; analyzed empirically. (see also, 2013 2016) respect, needed interact other. incident scandal. common wisdom unveiled, all political science provides actually 2005; Entman, 2012; Thompson, 2000). Three double theorize instrumentally views (Maier Lamargot), deflect focal (Dewan Jensen), achieve goals (Jourdan). More understand relationships scandals. Finally, examination identification. Whereas provide reduces will Antonacopoulou occupation, possibly detecting reporting apparently contradictory broader longer-lasting professions occupations under conditions safeguard against, or, promote it. debate, feel, far settled needed. Conclusions acquired momentum us, decline institutional trust. We consider society solve attain Goals. Our hope breadth depth included impetus inspiring fascinating fundamentally topic. Notes 1https://www.frc.org.uk/news/march-2021/investigation-into-deloittefor-the-audits-of-look; https://www.insider.co.uk/news/deloitte-under-investigation-over-audits-23699445. 2https://www.justice.gov/usao-sdny/pr/former-ceo-and-cfo-public-telecommunications-company-charged-manhattan-federal-court; https://www.cnbc.com/2021/07/15/fte-networks-executivescharged-with-securities-fraud-conspiracy.html 3https://www.sec.gov/enforce/33-10975-s; https://www.clearyenforcementwatch.com/2021/09/two-recent-settlements-highlightheightened-sec-focus-on-accounting-fraud-and-potential-benefits-of-cooperation/ 4https://www.sec.gov/news/press-release/2021-174; https://www.justice.gov/opa/pr/former-chief-financial-officer-publicly-traded-company-sentencedtwo-years-significant References Adut, 2005Adut, A. (2005). scandal: Victorians, homosexuality, fall Oscar Wilde. American Journal Sociology, 111(1), 213–248. Arnold, 2004Arnold, B., P. (2004). Enron: An agency problems. Critical Perspectives Accounting, 15(6–7), 751–765. Castro, Phillips, Ansari, 2020Castro, A., N., S. (2020). Corporate corruption: review agenda Academy Management Annals, 14, 935–968. Durand, Porac, 2016Clemente, M., R., J. (2016). bias. Key perspectives (pp. 435–466). Cambridge University Press. 2017Clemente, C. (2017). How does frame scandals? German newspapers diesel Inquiry, 26(3), 287–302. 2001Coffee, Jr. (2001). It’s about gatekeepers, stupid. Business Lawyer, 57, 1403–1421. Cooper, Tina, 2013Cooper, D. J., D., (2013). Fraud accounting, society: Extending Society, 38(6-7), 440–457. Dickie, 2004Dickie, nostra. history Sicilian mafia. Palgrave Macmillan. 2012Entman, (2012). Scandal silence: Media responses presidential misconduct. Polity. Ferrarini, 2006Ferrarini, G., (2006). enforcement: case. Armour McCahery (Eds.), After Improving law modernising regulation Europe US. Hart Publishing. 2003Fox, L. (2003). rise fall. John Wiley Sons. Mazzola, Minoja, 2013Gabbioneta, P., illegality. 38(6–7), 484–504. George, Howard-Grenville, Joshi, Tihanyi, 2016George, tackling through management Journal, 59, 1880–1895. 2009Goff, K. G. (2009). return barter. Network 16(9), 37. Greve, Pozner, 2010Greve, H. J.-E. (2010). gone wild: causes, processes, Annals Management, 4, 53–107. Healy, 2003Healy, Enron. Economic Perspectives, 17(2), 3–26. 2023Lounsbury, (2023). Problem Trust. Organization Studies, 44(2), 308–310. Marin, Schnitzer., 2002Marin, (2002). Contracts trade transition: MIT McLean, 2013McLean, smartest guys room: amazing Penguin Group. 2005Melis, Governance Failures: particularly Case? Governance: International Review, 13, 478–488. Muzio, Faulconbridge, 2016Muzio, Bad apples, bad barrels cellars: ‘boundaries’ Smith-Crowe, directions. 2012Palmer, Normal theories Oxford Piazza, 2018Piazza, (2018). When dust settles: competition. 61, 165–190. 2020Roulet, T. Blame game theory: Scapegoating, whistleblowing discursive struggles accusations Theory, 1, 1–30. 2018Roulet, Let’s media’s box: set heterogeneous homogenous ensemble. 43, 327–329. 2000Thompson, B. (2000). Political Power visibility age. UNDOC, 2020UNDOC. Nations Office Drugs Crime. https://www.un.org/sustainabledevelopment/blog/2015/12/on-anti-corruption-day-un-says-ending-corrosive-crime-can-boost-sustainable-development/ Unerman, O’Dwyer, 2004Unerman, Enron, WorldCom, Andersen al.: modernity. 971–993. Zucker, 1986Zucker, (1986). Production trust: sources economic structure, 1840–1920. Behavior, 8, 53–111. Book Chapters Prelims Introduction: Chapter 1: Evolving Definition Wrongdoing: Case Gray Area Around Mafia 2: Bailout Outlaws: Interactions Between Perception 3: Influence Events Misconduct: Regulatory Enforcement Banking Industry 4: Moral Interaction: Towards Perspective Publicization 5: Single-actor Multiple-actor Scandal? Framework Studying Dynamics 6: Framing Scandal: Path Redemption Road Perdition? 7: Conditioned Upbringing: Executives' Childhood Class Crime 8: What About My Occupation? Multidimensional View Workplace Identification Pro-Organizational Behavior 9: Wrongdoing, Boundary Work, Exclusion: Emissions 10: Street-level Happens: Deploying Complex Routines Coping Strategy Detrimental Consequences 11: Keeping “Men” Longshoremen: Origins Lasting Discrimination Against Women Longshore Occupation 12: Where Audit? Professional Wells Fargo