Boards of directors are held responsible for employee misconduct regardless of actual control

Evidence

Nevertheless, the analyses of causal paths revealed that the rating of intentionality did lead to the rating of responsibility in both the food poisoning and the insider trading scenarios (overall β = .40, p < .01). Furthermore, perceived responsibility significantly influenced the intent to purchase a product of this company (β = −.22, p < .05). Interestingly, the perceived responsibility fully mediated the influence of intentionality perceived in the executive board leading to the simulated consumer’s intent to purchase. Exactly the same meditational effect was found in another experiment using a different scenario (i.e., a sexual harassment case; Hioki & Karasawa, 2010, Study 1). Taken together, these results suggest that a highly entitative subgroup with an executive function (e.g., board of directors) is perceived to behave intentionally and is also held responsible for acts by members of a more comprehensive group (e.g., employees of a company). Furthermore, the perception of subgroup intentionality and responsibility may determine attitudes or behavioral intention toward the group (e.g., consumer intent to purchase). — Roderick M. Kramer, Geoffrey J. Leonardelli, Robert W. Livingston, Social Cognition, Social Identity, and…, 163

Categorization

• SEED: An essay angle: how perceived group entitativity transfers blame from individual bad actors up to top leadership, and how companies’ purchase intent gets punished for it.
• XREF: Connects to moral psychology of group blame and to corporate governance accountability debates.