Moral Degradation, Business Ethics, and Corporate Social Responsibility in a Transitional Economy

Qinqin Zheng, Yadong Luo, Stephanie Lu Wang

Research output: Contribution to journalArticlepeer-review

35 Scopus citations

Abstract

This article theoretically proposes and empirically verifies an understudied issue in the business ethics (BE) and corporate social responsibility (CSR) literature-how moral degradation (MD) in a society influences the relationship between BE or CSR and firm performance (i.e., corporate legitimacy and competitive advantage). Building on strategic choice theory, we propose that both BE and CSR become more important in enhancing business success when the perceived MD is heightened. Our analysis of 300 firms operating in China statistically confirms our hypotheses: first, under high MD, firms' engagement in CSR results in higher corporate legitimacy and competitive advantage, and second, their adherence to ethical business codes leads to higher corporate legitimacy. We conclude the article by outlining the implications for both theory and practice.

Original languageEnglish (US)
Pages (from-to)405-421
Number of pages17
JournalJournal of Business Ethics
Volume120
Issue number3
DOIs
StatePublished - Jan 1 2014

Keywords

  • Business ethics
  • CSR
  • Moral degradation
  • Transitional economy

ASJC Scopus subject areas

  • Business and International Management
  • Business, Management and Accounting(all)
  • Arts and Humanities (miscellaneous)
  • Economics and Econometrics
  • Law

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