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Publications
Publications
  • 2017
  • Working Paper

Does Financial Misconduct Affect the Future Compensation of Alumni Managers?

By: Boris Groysberg, Eric Lin and Georgios Serafeim
  • Format:Print
  • | Language:English
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Abstract

We explore how an organization’s financial misconduct may affect pay for former employees not implicated in wrongdoing. Drawing on stigma theory we hypothesize that although such alumni did not participate in the financial misconduct and they had left the organization years before the misconduct, they experience a compensation penalty. Our results support this prediction. The stigma effect increases in relation to the job function proximity to the misconduct, recency of the misconduct, and an employee’s seniority. Collectively, our results suggest that the stigma of financial misconduct could reach alumni employees and need not be confined to executives and directors that oversaw the organization during the misconduct.

Keywords

Corporate Misconduct; Restatements; Stigma; Financial Misconduct; Compensation and Benefits; Crime and Corruption; Employees

Citation

Groysberg, Boris, Eric Lin, and Georgios Serafeim. "Does Financial Misconduct Affect the Future Compensation of Alumni Managers?" Working Paper, November 2017.
  • SSRN

About The Authors

Boris Groysberg

Organizational Behavior
→More Publications

George Serafeim

Accounting and Management
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More from the Authors

    • August 2023
    • Faculty Research

    Beamery: Using Skills and AI to Modernize HR

    By: Boris Groysberg, Alexis Lefort, Susan Pinckney and Carolina Bartunek
    • July 2023
    • Faculty Research

    Vytal: Packaging-as-a-Service

    By: George Serafeim, Michael W. Toffel, Lena Duchene and Daniela Beyersdorfer
    • July 2023
    • Faculty Research

    The LPGA’s Long Drive Toward Gender Equity (B)

    By: Boris Groysberg and Alexis Lefort
More from the Authors
  • Beamery: Using Skills and AI to Modernize HR By: Boris Groysberg, Alexis Lefort, Susan Pinckney and Carolina Bartunek
  • Vytal: Packaging-as-a-Service By: George Serafeim, Michael W. Toffel, Lena Duchene and Daniela Beyersdorfer
  • The LPGA’s Long Drive Toward Gender Equity (B) By: Boris Groysberg and Alexis Lefort
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