Journal of Business Ethics

, Volume 26, Issue 4, pp 341–350 | Cite as

Corporate Philanthropy, Criminal Activity, and Firm Reputation: Is There a Link?

  • Robert J. Williams
  • J. Douglas Barrett


This study examined the influence of corporate giving programs on the link between certain categories of corporate crime and corporate reputation. Specifically, firms that violate EPA and OSHA regulations should, to some extent, experience a decline in their reputations, while firms that contribute to charitable causes should see their reputations enhanced. The results of this study support both of these contentions. Further, the results suggest that corporate giving significantly moderates the link between the number of EPA and OSHA violations committed by a firm and its reputation. Thus, while a firm's reputation can be diminished through its violation of various government regulations, the extent of the decline in reputation may be significantly reduced through charitable giving.

corporate philanthropy corporate reputation criminal activity interactions 


Unable to display preview. Download preview PDF.

Unable to display preview. Download preview PDF.


  1. Akerlof, G. A. and P. M. Romer: 1993, ‘Looting: The Economic Underworld of Bankruptcy For Profit’, Brookings Papers on Economic Activity 2, 1–60.Google Scholar
  2. Bandura, A.: 1974, ‘Behavior Theory and the Models of Man’, American Psychologist 29, 859–869.Google Scholar
  3. Bandura, A.: 1977, Social Learning Theory(Prentice-Hall, Englewood Cliffs, NJ).Google Scholar
  4. Baucus, M. S. and D. A. Baucus: 1997, ‘Paying The Piper: An Empirical Examination of Longer-Term Financial Consequences of Illegal Corporate Behavior’, Academy of Management Journal 40, 129–151.Google Scholar
  5. Baucus, M. S. and J. P. Near: 1991, ‘Can Illegal Corporate Behavior Be Predicted? An Event History Analysis’, Academy of Management Journal 34, 9–36.Google Scholar
  6. Beatty, R. P. and J. R. Ritter: 1986, ‘Investment Banking, Reputation, and Underpricing of Initial Public Offerings’, Journal of Financial Economics 15, 213–232.Google Scholar
  7. Becker, G. S.: 1964, ‘Crime and Punishment: An Economic Approach’, Journal of Political Economy 76, 169–217.Google Scholar
  8. Belsley, D. A., E. Kuh and R. E. Welsch: 1980, Regression Diagnostics: Identifying Influential Data and Sources of Collinearity(Wiley & Sons, New York).Google Scholar
  9. Brigham, E. F.: 1995, Fundamentals of Financial Management(The Dryden Press, Fort Worth, TX).Google Scholar
  10. Bromley, D. B.: 1993, Reputation, Image and Impression Management(Wiley & Sons, New York).Google Scholar
  11. Brown, B. and S. Perry: 1994, ‘Removing the Financial Performance Halo From Fortune's “Most Admired” Companies’, Academy of Management Journal 37, 1347–1359.Google Scholar
  12. Clinard, M. B. and P. C. Yeager: 1980, Corporate Crime(Free Press, New York).Google Scholar
  13. Cohen, M. A.: 1992, ‘Environmental Crime and Punishment: Legal/Economic Theory and Empirical Evidence on Enforcement of Federal Environmental Statutes’, The Journal of Criminal Law and Criminology 82, 1054–1108.Google Scholar
  14. Corporate 500 Directory of Corporate Philanthropy: 1991–1994 (Datarex Corporation, San Francisco).Google Scholar
  15. Daboub, A. J., A. M. Rasheed, R. L. Priem and D. A. Gray: 1995, ‘Top Management Team Characteristics and Corporate Illegal Activity’, Academy of Management Review 20, 138–170.Google Scholar
  16. Davidson, W. E. and D. M. Worrell: 1988, ‘The Impact of Announcements of Corporate Illegalities on Shareholder Returns’, Academy of Management Journal 31, 195–200.Google Scholar
  17. Fombrun, C. and M. Shanley: 1990, ‘What's in a Name? Reputation Building and Corporate Strategy’, Academy of Management Journal 33, 233–258.Google Scholar
  18. Garbett, T.: 1988, How to Build a Corporation's Identity and Project its Image(Lexington Books, Lexington, MA).Google Scholar
  19. Graham, J. R.: 1995, ‘Corporate Giving: Is It Good For Business?’, U.S.A. Today Magazine 123(January), 60–61.Google Scholar
  20. Gray, J. G.: 1986, Managing the Corporate Image(Quorum Books, Westport, CT).Google Scholar
  21. Gregory, J. R.: 1991, Marketing Corporate Image(NTC Business Books, Lincolnwood, IL).Google Scholar
  22. Hill, C. W. L., P. C. Kelley, D. R. Agle, M. A. Hitt and R. E. Hoskisson: 1992, ‘An Empirical Examination of the Causes of Corporate Wrongdoing in the United States’, Human Relations 45, 1055–1076.Google Scholar
  23. Klein, B. and K. Leffler: 1981, ‘The Role of Market Forces in Assuring Contractual Performance’, Journal of Political Economy 89, 615–641.Google Scholar
  24. Marconi, J.: 1996, Image Marketing(NTC Business Books, Lincolnwood, IL).Google Scholar
  25. Milgrom, P. and J. Roberts: 1986, ‘Relying on the Information of Interested Parties’, Rand Journal of Economics 17, 18–32.Google Scholar
  26. Miller, W. H.: 1996, ‘Citizenship that's Hard to Ignore’, Industry Week(2 September), 21–24.Google Scholar
  27. Moody's Industrials: 1991–1994 (Moody's Investors Service, Inc., New York).Google Scholar
  28. National Directory of Corporate Giving: 1991–1994 (The Foundation Center, New York).Google Scholar
  29. Rumelt, R. P.: 1974, Strategy, Structure, and Economic Performance(Harvard Business School Press, Boston).Google Scholar
  30. Sears, R. S. and G. L. Trennepohl: 1993, Investment Management(The Dryden Press, Fort Worth, TX).Google Scholar
  31. Shaw, B. and F. R. Post: 1993, ‘A Moral Basis for Corporate Philanthropy’, Journal of Business Ethics 12, 745–751.Google Scholar
  32. Simpson, S. S.: 1986, ‘The Decomposition of Antitrust: Testing a Multi-level, Longitudinal Model of Profit Squeeze’, American Sociological Review 51, 859–875.Google Scholar
  33. Smith, C.: 1994, ‘The New Corporate Philanthropy’, Harvard Business Review 72(3), 105–116.Google Scholar
  34. Staff: 1988, ‘Companies' Once Strong Support for Charitable Giving Seen Eroded by Changes in Society and Economy’, Chronicle of Higher Education(11 May), A23–A24.Google Scholar
  35. Staff: 1995, ‘Corporate Reputations’, Fortune(6 March), 54–94.Google Scholar
  36. Staw, B. M. and E. Szwajkowski: 1975, ‘The Scarcity-Munificence Component of Organizational Environments and the Commission of Illegal Acts’, Administrative Science Quarterly 20, 345–354.Google Scholar
  37. Sutherland, E. H.: 1947, Principles of Criminology(Lippincott, Philadelphia).Google Scholar
  38. Value Line Investment Survey: 1991–1994 (Value Line Publishing, Inc., New York).Google Scholar
  39. Yeager, P.: 1986, ‘Analyzing Corporate Offenses: Progress and Prospects’, in J. E. Post (ed.), Research in Corporate Social Performance and Policy(JAI Press, Greenwich, CT), pp. 93–120.Google Scholar

Copyright information

© Kluwer Academic Publishers 2000

Authors and Affiliations

  • Robert J. Williams
    • 1
  • J. Douglas Barrett
  1. 1.College of BusinessUniversity of North AlabamaFlorenceU.S.A.

Personalised recommendations