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Distributor whistleblowing: The effects of manufacturer trustworthiness, opportunism, and transaction contexts

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Abstract

Distributor whistleblowing, which involves disclosing peers’ misconduct to the manufacturer, plays a crucial role in the governance of distribution relationships. This study focuses on the interfirm relationship between a potential distributor whistleblower and a manufacturer to explore the effects of manufacturer characteristics on distributor whistleblowing. In particular, drawing on relational exchange theory and transaction cost economics, this study examines the effects of manufacturer trustworthiness and opportunism on distributor whistleblowing, along with the moderating effects of transaction contexts (distributor relative transaction-specific investment and relationship duration). Data from 211 senior distributor managers reveal that manufacturer trustworthiness has a positive effect on distributor whistleblowing, which is weakened by distributor relative transaction-specific investment and strengthened by relationship duration. In contrast, manufacturer opportunism has a negative impact on distributor whistleblowing that is undermined by relationship duration. These findings provide new insights into how to encourage distributor whistleblowing.

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Notes

  1. Our interviews with channel and purchasing managers revealed that distributor misconduct that violates the terms defined in the manufacturer’s established distribution agreements is widespread, and distributors often detect the misconduct earlier than the manufacturer and report it to the manufacturer. According to the interviewees, the reported misconduct includes selling fake or substandard products, pricing products under the agreed price floor, and selling outside specified areas.

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Acknowledgements

This study was supported by National Natural Science Foundation of China (NO. 72172026 & NO. 72202027) and National Social Science Foundation of China (NO. 21&ZD120).

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Authors and Affiliations

  1. School of Economics and Management, Dalian University of Technology, Dalian, 116024, China

    Jing Zhou & Chuang Zhang

  2. Collat School of Business, University of Alabama at Birmingham, 35294, Birmingham, AL, USA

    Shibin Sheng

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  1. Jing Zhou
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Zhou, J., Zhang, C. & Sheng, S. Distributor whistleblowing: The effects of manufacturer trustworthiness, opportunism, and transaction contexts. Asia Pac J Manag (2024). https://doi.org/10.1007/s10490-024-09971-3

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