The Impact Of Environmental Violation On Corporate Reputation

In the era of globalization, the increasingly fierce competition and thenotably-elevated civilization, the whole society has placed more and moreemphasis on corporate ethics. On the other hand, the information age hasempowered the public with the ability of obtaining and deliveringinformation in real-time, which calls for a more transparent corporatebehavior. To build and maintain corporate reputation has therefore calledfor mounting attention from the corporate management. Environmentalviolation, from the perspective of consumers, undoubtedly exerts a largenegative effect on corporate reputation. How do environmental violationincidents affect the public and the corporate reputation? And what factorswill play a role in determining how the public react to those incidents? Thisthesis aims at finding answers to these questions.Built upon the reputation theory, the classification and the analysis ofthe past research, this thesis formulates the theoretical model of howenvironmental violation affects the reputation through consumers’perception of corporation ethics. It also analyzes the moderating functionof the corporate social responsibility in the model. Following the studyingmethod of consumer behavior, this essay designs and conducts three case- based experiments, and testifies the theoretical model through the sampledata. Test results shows:(1) Environmental violation has negative impactson corporate reputation.(2) Environmental violation has harmful effectson consumer’s perception of corporate ethics.(3) Environmental violationhas negatively affected the corporate reputation through consumers’perception of corporate ethics.(4) Corporate social responsibility behaviorpositively moderates the effects which environmental violation exerciseson corporate reputation through consumers’perception of corporate ethics.This thesis’s contribution lies in:(1) filling in the gaps of the studyregarding the effects environmentalviolationhasonconsumers’perception;(2) using experiment method to analyze the objects containing multipleuncertain factors;(3) finding the mechanism of how environmentalviolation affects corporate reputation.