Abstract. The law is a crucial mechanism through which social movements shape organizational fields, yet little is known about how movements influence legal judgments against organizations. We argue that social movements augment punitive legal outcomes against organizations by raising the salience and urgency of deviant practices, triggering affective responses that intensify public demands for accountability. We expect these dynamics to manifest in the punitive damages awarded by jurors against organizations found liable for movement-contested behaviors. Using a difference-in-differences design applied to a hand-constructed database of jury verdicts in employment discrimination cases adjudicated before and after the mainstream emergence of the #MeToo Movement in October 2017, we find a significant post-#MeToo increase in punitive damages in sexual harassment cases relative to other discrimination claims. Critically, this increase is concentrated in partisan-aligned communities, with no detectable effect in partisan-misaligned ones. These findings challenge classical accounts of legal punishment as a uniform expression of collective norms. The costs the legal system imposes on organizations reflect not a unified societal judgment but the segmented moral orders of the communities in which trials are held, calling for greater attention to how polarization conditions the financial consequences social movements impose on organizations.

Abstract. Conventional accounts expect stakeholder and investor responses to track the valence of corporate conduct, with responsible actions generating positive responses and irresponsible actions negative responses. We challenge this by integrating expectation-confirmation theory with cognitive psychology to argue that sentiment shocks—abnormal deviations in stakeholder affect relative to firm-specific expectations—are the operative investor signal. While expectancy-confirming events are financially muted, violations prompt reappraisal. We introduce Cumulative Abnormal Media Sentiment (CAMS), a firm-specific sentiment shock measure analogous to Cumulative Abnormal Returns, validated by replicating and extending Flammer’s (2013) environmental event study through 2024. We find that sentiment shocks predict stock price reactions, though the weight investors assign is conditional on environmental reputation. Specifically, sentiment shocks carry inconsistent weight where reputation creates interpretive ambiguity, and differentiated responses where it does not.

Funded by the Mack Institute for Innovation Management, The Wharton School, University of Pennsylvania

Abstract. When is an executive’s misconduct attributed to the organization rather than the individual responsible? Prior work suggests evaluators more readily blame individuals than organizations, an asymmetry mirrored in organizations’ reliance on succession alone to sever themselves from the locus of blame. I argue that this asymmetry reverses when an organization’s identity is tightly coupled to an implicated executive’s own, a condition I term key-man reputational risk (KMRR). Under high KMRR, evaluators use the executive’s identity as a lens through which to interpret the organization itself, causing fault attribution to spill over from the executive to the organization. Drawing on over 100 executives terminated for workplace sexual misconduct (2010-2025), I find that organizations with greater exposure to KMRR experience stronger reputational spillover following misconduct-triggered succession, and that organizations may attenuate this spillover through substantive person and policy remediation. These findings identify the cognitive mechanisms that turn organizations into credible targets of blame, addressing recent calls for closer attention to this process (McDonnell & Nurmohamed, 2021), and clarify when remediation can decouple organizational identity from a departing leader.

Funded by the Zicklin Center for Governance & Business Ethics at the Impact, Value , and Sustainable Business Initiative, The Wharton School, University of Pennsylvania