Relative Performance Transparency: Effects on Sustainable Choices

Ryan W. Buell; Shwetha  Mariadassou; Yanchong  Zheng

Working Paper | HBS Working Paper Series | 2019

Relative Performance Transparency: Effects on Sustainable Choices

by Ryan W. Buell, Shwetha Mariadassou and Yanchong Zheng

Abstract

We study how transparency into the levels and changes of relative sustainability performance affects consumer choices. Our work considers two forms of transparency: process transparency, in which customers receive information about the company's sustainability performance relative to other companies, and customer transparency, in which customers receive information about their own sustainability performance relative to other customers. Through three studies with 7,308 participants, we observe that revealing the levels of relative performance is more motivating for customers in the process transparency domain, whereas revealing relative changes in performance is more motivating for customers in the customer transparency domain. We employ structural equation modeling to identify the underlying mechanisms for these results. We show that levels information is more reflective of objective performance comparison, thus strengthening motivation in the domain of process transparency. In contrast, changes information helps to mitigate self-serving attribution biases in the customer transparency domain, thus playing a more significant role in affecting motivation.

Keywords: relative performance tranparency; process transparency; customer transparency; levels; changes; reflectiveness; self-serving attribution biases; sustainability; consumer choice;

Language: English

Format: Print

37 pages

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Citation:

Buell, Ryan W., Shwetha Mariadassou, and Yanchong Zheng. "Relative Performance Transparency: Effects on Sustainable Choices." Harvard Business School Working Paper, No. 19-079, January 2019.

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Relative Performance Transparency: Effects on Sustainable Choices

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