We found a match
Your institution may have access to this item. Find your institution then sign in to continue.
- Title
Boards of Directors' Sanction Judgments: The Effect of Situational Factors.
- Authors
Wall, Joseph M.; Gissel, Jodi L.
- Abstract
This study investigated the influence of situational factors on sanction judgments by individuals who serve on boards of directors. Members of the board of directors often guide control processes, including sanction guidance for internal and external rules violations. This study is the first to investigate the decisions of such members in this context in the presence of mitigating circumstances. Based on evolutionary governance theory and punishment theory regarding deterrence and retribution, as well as literature on the role empathy can play in judgments, an experiment was designed to analyze how variation in three factors (history of similar incidents, compensation structure, and reason for violation) impacts directors' sanction recommendations. Findings suggest board members focused on history of violations (repeat or first-time offender) and were not influenced by whether the individual received financial benefit (in terms of compensation structure) or by empathetic situations (altruistic versus opportunistic motivation for the act). This holds true for both sanction type and amount of monetary sanction. Participants emphasized warning and fine sanctions, with warning more likely for a first-time offender and fine more likely for a repeat offender. Implications for boards relating to punishment guidance are discussed, as well as recommendations for future research building on this study.
- Publication
Journal of Managerial Issues, 2019, Vol 31, Issue 1, p85
- ISSN
1045-3695
- Publication type
Academic Journal