Unethical behavior and organization’s survival
Types of organizational legitimacy
Pragmatic: as a professor teaches so the students can understand —> pragmatic legitimacy, but maybe not ethical person
Cognitive: Professor quite effective, use out of the box methodologies —> teaching out of expected boundaries → no cognitive legitimacy
Moral: judgment of right and wrong. If professor lets us cheat, is unfair in assessing exams → no moral legitimacy → in ethics we talks mostly about moral legitimacy
The VW emissions scandal
immediate reaction/impacts of loosing legitimacy → profit loss, stock price fell (investors and costumers support withdrawn) → happened to the European Markt as well
similar companies can have spill over effects —> will also be affected by the loss of legitimacy
Legitimacy spillover effect on industry and geography
Managing legitimacy
several ways how to respond to legitimacy threat → from denial to stakeholder engagement
justification → explain why they did it
apology → do sth about it
symbolic alignment → important to me so take steps to solve it (not substantive → symbolic)
substantive alignment → show that you act a different way (substantive)
stakeholder engagement → whole industry can profit???
Symbolic vs. substantive actions
Minor ethical issues (stakeholders maybe not being that interested): symbolic actions can be enough
Last changed3 months ago
