Empirical findings consistent with Legitimacy Theory would be increased disclosure of:
A) Environmental good news, immediately following prosecutions for breaches of environmental standards
B) Environmental bad news, immediately following prosecutions for breaches of environmental standards
C) Environmental good news, immediately preceding prosecutions for breaches of environmental standards
D) Environmental bad news, immediately preceding prosecutions for breaches of environmental standards

Question

Quizplus · Accepted Answer

Legitimacy Theory suggests that organizations will seek to maintain or repair their legitimacy in the eyes of their stakeholders, especially after an event that threatens their legitimacy, such as a prosecution for breaching environmental standards. Disclosing environmental good news immediately following such prosecutions can be seen as an effort to mitigate the negative impact and restore legitimacy.

Empirical Findings Consistent with Legitimacy Theory Would Be Increased Disclosure