Determinants and benefits of over-certification: A signaling theory perspective

Abstract

Different types of organizations use certifications to reduce information asymmetry in an extensive range of business activities. In some cases, the widespread use of certifications can lead to multiple competing and overlapping standards. Some organizations also obtain similar certifications in a process defined as over-certification, which is understudied in the literature. The primary objective of this study is to identify the determinants of the over-certification process, specifically regarding the influence of stakeholders that motivate organizations to engage in over-certification. Grounded in both signaling and stakeholder theories, this study confirms the isomorphic effect of stakeholders' pressures that creates different motivations for using different (but similar) certifications. An empirical analysis of a sample of 418 European organizations highlights that the decoupling in the interest in certifications is the main antecedent of over-certification in relation to corporate social responsibility-related certifications. Our results also show that the occurrence of over-certification in organizations is mainly due to its ability to impact corporate reputation, confirming the signaling value of different (but similar) certifications.