| Summary: | This study focuses on stigma flow from the responsible individuals to others and investigates the effects of several relationship elements on stigma, between these two parties, following a financial misconduct. The study sets out to confirm the concept of stigma proposed by Link and Phelan [2001]. It also aims to empirically prove that individuals who are closely associated could expect to suffer from a larger amount of stigma. Further, the study also hopes to establish a new model, which builds on existing stigma literature on the effects of controllability. We include power of individuals in an organisation under the same consideration that control could be derived from power, therefore affecting amount of stigma that one could expect to suffer.
All data in the pilot and main studies were gathered through surveys administrated on Amazon Mechanical Turk. To improve rigor and robustness of our research deliverables, findings from the pilot study were used to refine our methodology in the main study. Our study explored both first and third party perspectives, allowing for a holistic understanding of the perceptual stigma consequences affected by the relational variables explored.
While empirically proving Link and Phelan’s [2001] concept of stigma to be valid in an organization context, our significant results reaffirmed that an individual who is closely associated with the focal individual is likely to receive a higher level of stigma. Together with this finding, we propose a new stigma-transferring mechanism that assumes similar characteristics across individuals who are associated with each other in the focal firm. Our findings also support our model, showing that individuals will be perceived to suffer from more stigma when they have more power and authority in the organization suggesting that they have failed to exercise the control to stop or prevent the misconduct accompanying their power. Lastly, before we conclude our study, we further identified limitations and the possible future studies directions in light of the findings from our results and discussions.
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