The Apple Doesn't Fall Far From the Tree: A Three-Level Examination of the Corporate Hypocrisy Trickle-Down Effect

Abstract

Research on corporate social responsibility (CSR) has increasingly noted the danger of corporate hypocrisy, a misalignment between a firm's CSR claims and actions, yet little is known about its internal consequences. Drawing on social learning theory, this study explores how and when corporate hypocrisy cascades down through an organization to foster hypocrisy among employees. We employed a multi-level, three-tier data collection across 32 Chinese companies to test our model. The findings show that corporate hypocrisy at the organizational level does indeed trickle down. Specifically, it promotes team leader hypocrisy which, in turn, leads to team member hypocrisy. Moreover, this trickle-down effect is contingent on value alignment. It is strengthened when team leaders exhibit person-organization (PO) fit and team members exhibit person-supervisor (PS) fit. We discuss the theoretical and practical implications of the findings on the trickle-down effect of corporate hypocrisy.