Does misconduct spread through corporate networks?
Corporate misconduct, reputational risk and corporate scandals appear on 90 recent papers across the management, finance and accounting journals, mostly one firm at a time. Firms share directors, auditors, suppliers and bankers. Does misconduct travel along those links, and can network position predict who is next?
What prompted this
Since October 2025, 90 papers carry a scandal, corporate-misconduct, corporate-social-irresponsibility, reputation-damage, crisis-communication or misconduct keyword (31 in management journals, 30 in finance, 11 in economics, 10 in accounting): "corporate misconduct" on 22, "reputational risk" on 21, "corporate social irresponsibility" on 9, "crisis communication" on 8, "corporate scandals" on 5.
Questions
- Are firms that share a director or auditor with a firm caught in misconduct more likely to be caught later, and does the link run through practices or through enforcement attention?
- When a scandal hits one firm, do customers and investors punish its peers, and do the peers change behaviour?
- Can network measures improve the prediction of enforcement actions beyond firm characteristics?
Data that could help
Enforcement actions and restatements (Audit Analytics, SEC releases), director networks (BoardEx), auditor identities and supply chain links.
Next step
Build the director network of listed firms and test whether a board link to a sanctioned firm predicts later sanctions, controlling for industry and size.