Journal of Business Ethics

, Volume 112, Issue 3, pp 397–415 | Cite as

Business Unethicality as an Impediment to Consumer Trust: The Moderating Role of Demographic and Cultural Characteristics

  • Leonidas C. Leonidou
  • Olga Kvasova
  • Constantinos N. Leonidou
  • Simos Chari
Article

Abstract

The article reports the findings of a study conducted among 387 consumers regarding their perceptions of the unethicality of business practices of firms and how these affect their response behavior, in terms of trust, satisfaction, and loyalty. The study confirmed that high levels of perceived corporate unethicality decrease consumer trust. This in turn reduces consumer satisfaction, which ultimately has negative effects on customer loyalty. It was also revealed that, although both consumer gender and urbanity have a moderating effect on the link between perceived unethicality and trust, the age group and level of education of the consumer did not exhibit such an effect. With regard to consumer cultural characteristics, both high uncertainty avoidance and low individualism were found to increase the negative impact of business unethicality on trust, as opposed to power distance and masculinity that did not have any moderating effect on this relationship. Implications for managers are extracted from the study findings, as well as directions for future research.

Keywords

Business ethics Trust Satisfaction Loyalty Consumer demographics Cultural orientation 

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© Springer Science+Business Media B.V. 2012

Authors and Affiliations

  • Leonidas C. Leonidou
    • 1
  • Olga Kvasova
    • 3
  • Constantinos N. Leonidou
    • 2
  • Simos Chari
    • 2
  1. 1.Department of Public and Business Administration, School of Economics and ManagementUniversity of CyprusNicosiaCyprus
  2. 2.Leeds University Business SchoolUniversity of LeedsLeedsUK
  3. 3.LimassolCyprus

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