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JOURNAL OF LEADERSHIP, ACCOUNTABILITY AND ETHICS

Organizational Illegal Behavior as an Unanticipated Consequence of Philanthropy:

Explaining a Paradox

Author(s): Rebecca Wyland, Matthias Bollmus, Michael Freimark, Eric Hedrich

Citation: Rebecca Wyland, Matthias Bollmus, Michael Freimark, Eric Hedrich, (2012) "Organizational Illegal Behavior as an Unanticipated Consequence of Philanthropy:

Explaining a Paradox," Journal of Leadership, Accountability and Ethics, Vol. 9, Iss. 3, pp. 41 - 52

Article Type: Research paper

Publisher: North American Business Press

Abstract:

We investigate how organizations engage in illegal behavior. We draw on institutional and signaling

theory to suggest that corporate philanthropy creates legitimacy by signaling a positive organizational

image. Additionally, we draw on key resources theories to suggest that individual resources create a

positive reputation and create legitimacy by signaling a positive individual image. Based on these

positive organizational and individual images, there may be an unanticipated consequence, whereby

legitimacy becomes a catalyst to a process that could be potentially detrimental. Specifically, actors

within the organization who engaged in corporate philanthropy may have done so with good intentions;

however, other actors within the organization may capitalize on this increased legitimacy fueled by their

individual and the organization’s positive social engagements and take advantage of the opportunity to

engage in corporate illegal behavior. Implications of the proposed relationship and their limitations are

provided, as well as a discussion of future research opportunities.