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Prior research finds that firms disclosing a focus on corporate social responsibility (CSR) experience less negative reactions following a corporate misstep. We predict that this “insurance effect” is limited to cases of ordinary failures (i.e., failures not directly related to the social or environmental impacts of the firm) and may provide no protection when a failure is directly related to CSR. Further, we hypothesize a potential “backfire effect,” where investors react more negatively to a CSR-focused firm in the case of a CSR-related failure than to a traditional firm experiencing the same failure. In-keeping with attribution theory and expectancy violations theory, our results support the predicted limitation of the insurance effect. In addition, we find that the limited insurance effect is mediated by reputational assessments. Although directionally consistent, the proposed backfire effect is not statistically significant. Overall, our results suggest that CSR is not a panacea for dampening the penalties associated with business missteps, and managers seeking to benefit from CSR engagement should be diligent in monitoring their firms' future CSR performance.

It is important to understand how recent regulation allowing small businesses to issue equity through crowdfunding can impact investors' decision-making. One unique feature of crowdfunding presented to investors is an issuer's fundraising goal (i.e., minimum target) and how much money has currently been pledged toward that goal by other investors. However, it is unknown whether investors are sensitive to the level at which the minimum target is set, which can influence the perception of the level of support an investment has received from other investors. While holding the amount of capital pledged to an issuer constant, we conduct an experiment to examine how the minimum level of an issuer's fundraising goal impacts the likelihood of investment by investors. We predict that lower minimum goals will facilitate a perception that an issuer has strong support from other investors and will lead to a change in how investors perceive that issuer. We find that, regardless of the financial strength of the issuer, lower minimum fundraising goals lead to greater investment likelihood compared to higher minimum fundraising goals. We also find that issuers with weak financial strength tend to benefit from this effect more than stronger firms. Finally, this effect is mediated by investors' perceptions of the support of other investors in the company. The results of our study have both practical and theoretical contributions.

Increasing one's chances for early job attainment is a major motivation for accounting graduates. Accounting programs are often evaluated by the job attainment rates of their graduates. Therefore, it is important to understand the factors that affect the early job attainment of accounting graduates. This study provides insight into variables that influence job outcomes for accounting graduates. In particular, our results demonstrate that gender, internship experience, grade point average (GPA), and transfer status each significantly impact the early employment of accounting students. Further, the relationships between gender and job attainment, as well as GPA and job attainment, are partially mediated through internship experience. This suggests that gender and GPA not only impact job outcomes directly but also impact job outcomes through their effect on internship attainment. The findings could help accounting programs better prepare, advise, and assist future students in their academic activities, thereby improving students' chances of early accounting job attainment.

Organizations are considering the influence of workplace attention breadth (mindfulness and absorption) on professional development. Although corporate accountants typically focus on technical skills, soft skills such as mindfulness may also improve performance. In this study, we examine the influence of attention breadth on task performance by demonstrating how mindfulness and absorption vary with respect to improvement to entry, mid, and upper-level accounting tasks. We survey over 700 corporate accounting professionals and find that upper-level manager task performance is related to mindfulness, and mid-level manager task performance is associated with mindfulness and absorption. We also find that mid-level professionals who are unable to transition between mindfulness and absorption states serve a relatively longer tenure before advancing to an upper-level position. This study has important implications for management to assist in improving office productivity and morale.

Allocation problems in accounting require joint costs to be allocated among participating agents. In this setting, however, unfair allocations can stifle cooperation and lead to inefficient group outcomes. Then, what qualifies as fair enough for individual agents to agree to cooperate and extract joint benefits? Building on prior analytical literature that has offered perspectives involving joint cost allocations, we experimentally evaluate two common notions of fairness that present competing predictions in the cost allocation context – proportionality and equality. We operationalize two notions of fairness using a behavioral approach and examine which fairness notion prevails in cost allocation problems. More specifically, we examine fairness considerations in the cost allocation context using a modified ultimatum game, where joint cost savings can only be acquired through cooperation between two agents and individual contributions are varied transparently. Our experimental evidence suggests that fairness considerations in cost allocations coincide more with the proportionality notion when individuals make different contributions to create joint benefits. These findings provide important insights on the key rationale underlying the prevalent cost allocation method in accounting practices and the design of fair cost allocations that promote cooperation among agents.

Demographic characteristics such as race and ethnicity have long been shown to affect individuals' decision-making and can be associated with various behavioral outcomes. In this paper, we examine the association between the ethnicity of a chief financial officer (CFO) and financial reporting conservatism in a large sample of US public firms. We find that firms headed by CFOs of nonwhite ethnicities exhibit less conservative financial reporting than firms headed by white CFOs; however, this effect is attenuated for firms facing greater external scrutiny. Moreover, nonwhite CFOs in our sample recognize a higher level of discretionary accruals than white CFOs. Our study contributes to the literature on financial reporting and answers the call for more studies on top manager ethnicity effects. More importantly, our findings hold implications for both regulators and investors, given the prevalence and significance of diversity initiatives in today's globalized business environment.

We employ an experiment with experienced Chinese auditors to examine how family firm structures influence auditors' reliance on management's explanations for evidence and their assessments of fraud risk. Our findings indicate that for firms with family ownership, high levels of family managerial control cause auditors to rely less on management's explanations and assess higher levels of fraud risk when a firm's control environment is strong. However, when the control environment is weak, auditors' judgments are not influenced by family firm structure.

This study examines the sequential mediating role of employee organisational commitment (EOC) and innovation on the relationship between budgetary participation and competitive advantage. Data were collected from a mail survey questionnaire of 86 Australian organisations with PROCESS applied to analyse the data. The study's findings make a significant contribution to the budgetary participation and behavioural management literature and practice. Specifically, the study provides a theoretical insight into the role of an important employee behavioural factor, EOC and innovation in mediating the relationship between budgetary participation and competitive advantage. In particular, the findings inform practitioners that budgetary participation influences the EOC of employees and subsequently influence competitive advantage through exploratory innovation.