Georg Wernicke
University in Mannheim
CEO hypocrisy: How does CSR policy influence the reaction to excessive CEO pay?
Previous research suggests that policies on Corporate Social Responsibility (CSR) can be a liability or an asset for an organization in a moral crisis. Drawing from theories of moral evaluation, we provide a single framework to predict how CSR moderates both potential outcomes when an executive morally fails. We hypothesize that executives are more likely to be publicly condemned for immoral acts when their firms are perceived as “doing good” on the same moral domain. In such a case, a moral transgression by an executive gives rise to an inconsistency in moral conduct, which induces the perception of hypocrisy. We also argue that pro-social conduct along moral domains unrelated to the transgression (e.g., diversity and environment) and pro-social conduct raising doubts about the severity of the transgression generate moral credits and credentials, reducing the likelihood of public outcry.
Biography
Georg Wernicke is Ph.D. student in Management at the Center for Doctoral Studies in Business at the University in Mannheim (Germany) and since April 2013 a visiting Assistant Professor in Management at the Center for Corporate Governance at Copenhagen Business School (Denmark). Georg holds master degrees in Business Administration from Humboldt University of Berlin (Germany) and in Comparative Business Economics from University College London (UK). He was previously a visiting scholar at Stern School of Business at New York University (USA). His research mostly focuses on issues of corporate governance and corporate social responsibility, particularly on topics related to the role of the media as governance watchdog as well as the impact of public norms on executive compensation, boards of directors and firms’ social responsibility policies.