Recent Publications

Rolf Brühl: Should They Go, or May They Stay: Companies in Aggressor States, in: Journal of Business Ethics. 2024. Advanced online publication (to the article).

In response to Russia’s war of aggression and the accompanying human rights violations in Ukraine, several scholars have called for all multinational companies to divest and leave the country; otherwise, they become accomplices to the aggressor. This article reconstructs the arguments in favor of this general call. The first contribution of this article is to extend complicity theory to the context of crimes of aggression and atrocities to promote this demand. Although this extension of complicity theory ensures internal coherence, the call for a general divestment of all companies is tantamount to comprehensive economic sanctions. In contrast, recent developments in sanction theory as part of just war theory suggest that targeted sanctions are the legitimate sanctions that states prefer. Therefore, the second contribution is to evaluate sanctions morally and analyze and discuss the moral implications of three categories of goods and services (sanctioned, essential, and nonessential). This discussion shows no moral justification for a general call for all companies to leave an aggressor state. Companies have moral obligations to comply with legitimate sanctions, moral duties concerning essential goods, and moral permissions concerning nonessential goods.

Christina Novak Hansen and Rolf Brühl: How informational stimuli, formative experiences, and socialization can activate values to foster sustainable entrepreneurship engagement, in: Business Ethics, the Environment & Responsibility. 2024. Advanced online publication, 1-25 (to the open access article).

Research has shown that specific individual values, such as green and environmental values, are important in motivating the decision to start a sustainable business. Beyond this finding, there is limited knowledge about why, how, and when such values become important and what this means for sustainable entrepreneurship engagement. We address this question abductively and conduct a multi-case study of 18 sustainable entrepreneurs and their fashion companies. Drawing on the selfactivation and the impressionable years hypotheses, we identified three ways in which sustainability-oriented values become activated and more important to individuals: (1) through informational stimuli, (2) through formative and life-changing experiences, and (3) through socialization. Further, we show that the entrepreneurs engaged in reflexive learning due to the value-activating experience, whereby they critically questioned their assumptions and actions. Together, one or more value activations and the involved reflexive learning contributed significantly to the decision to become a sustainable entrepreneur. With this novel explanation for why and how values become engaged in the first place, we contribute to the theory of (sustainable) entrepreneurship. Further, our research helps devise value-activating strategies for practitioners who want to help (prospective) entrepreneurs act more in line with their sustainability-oriented values and start a sustainable business.

Jörn Basel und Rolf Brühl: Misstrauen. Eine interdisziplinäre Bestandsaufnahme, in:  Jörn Basel und Philipp Henrizi, Psychologie von Risiko und Vertrauen: Wahrnehmung, Verhalten und Kommunikation. Springer, Berlin, 2023, 269-299 (zum Artikel).

In diesem Beitrag werden aktuelle Erkenntnisse über die Auswirkungen von Misstrauen, insbesondere von sozialem Misstrauen, und der Zusammenhang zwischen Misstrauen und Vertrauen vorgestellt. Diese Betrachtung ist vor dem Hintergrund zu verstehen, dass eine konzeptionelle und empirische Auseinandersetzung mit dem Konstrukt Misstrauen in vielen Disziplinen erst in jüngster Zeit an Bedeutung gewonnen hat. Während Vertrauen als etabliertes Themenfeld gilt, sind zahlreiche grundsätzliche Fragen, wie z. B. nach den Ursachen, Voraussetzungen, Dimensionen und Operationalisierungen von Misstrauen, noch Gegenstand aktueller Diskussionen. Auf der Grundlage der aktuellen Literatur wird für eine eigenständige Sichtweise auf Misstrauen plädiert. Dies bedeutet aber auch, dass die Bemühungen in Bereichen wie der Messung und der Identifikation von möglichen positiven Wechselwirkungen noch deutlich auszubauen sind.

Moritz Schneider and Rolf Brühl: Disentangling the black box around CEO and financial information-based accounting fraud detection: machine learning-based evidence from publicly listed U.S. firms, in: Wolfgang Breuer and Andreas Knetsch (Eds.): Recent trends in the digitalization of finance and accounting. Journal of Business Economics, Special Issue, Volume 93, Issue 9, 2023, 1591-1628 (to the article).

This study investigates the predictive power of CEO characteristics on accounting fraud utilizing a machine learning approach. Grounded in upper echelons theory, we show the predictive value of widely neglected CEO characteristics for machine learning-based accounting fraud detection in isolation and as part of a novel combination with raw financial data items. We employ five machine learning models well-established in the accounting fraud literature. Diverging from prior studies, we introduce novel model-agnostic techniques to the accounting fraud literature, opening further the black box around the predictive power of individual accounting fraud predictors. Specifically, we assess CEO predictors concerning their feature importance, functional association, marginal predictive power, and feature interactions. We find the isolated CEO and combined CEO and financial data models to outperform a no-skill benchmark and isolated approaches by large margins. Nonlinear models such as Random Forest and Extreme Gradient Boosting predominantly outperform linear ones, suggesting a more complex relationship between CEO characteristics, financial data, and accounting fraud. Further, we find CEO Network Size and CEO Age to contribute second and third strongest towards the best model’s predictive power, closely followed by CEO Duality. Our results indicate U-shaped, L-shaped, and weak L-shaped associations for CEO Age, CEO Network Size, CEO Tenure, and accounting fraud, consistent with our superior nonlinear models. Lastly, our empirical evidence suggests that older CEOs who are not simultaneously serving as chairman and CEOs with an extensive network and high inventory are more likely to be associated with accounting fraud.

Teemu Malmi, David S. Bedford, Rolf Brühl, Johan Dergård, Sophie Hoozée, Otto Janschek, Jeanette Willert: The use of management controls in different cultural regions: an empirical study of Anglo-Saxon, Germanic and Nordic practices, in: Journal of Management Control, Volume 33, Issue 3, 2022, 273-334. (to article)

Most cross-cultural studies on management control have compared Anglo-Saxon firms to Asian firms, leaving us with limited understanding of potential variations between developed Western societies. This study addresses differences and similarities in a wide variety of management control practices in Anglo-Saxon (Australia, English Canada), Germanic (Austria, non-Walloon Belgium, Germany) and Nordic firms (Denmark, Finland, Norway, Sweden). Unique data is collected through structured interviews from 584 strategic business units (SBUs). We find that management control structures in Anglo-Saxon SBUs, relative to those from Germanic and Nordic regions, are more decentralized and participative and place greater emphasis on performance-based pay. Comparing Germanic SBUs to Nordic ones, we find Germanic SBUs to rely more on individual behaviour in performance evaluation, whereas Nordic SBUs rely more on quantitative measures and value alignment in employee selection. We also observe numerous similarities in MC practices between the three cultural regions. The implications of these findings for theory development are outlined.

Rolf Brühl: On the responsibility of corporate actors for human rights in the supply chain, in: Wenzel Matiaske, Dorothea Alewell and Ortrud Leßmann (Eds.): The 'Betrieb' as corporate actor. Management Review, Special Issue, Volume 33, 2022, 60-83 (to the article). 

States are fundamentally obliged to respect and protect human rights vis-à-vis their citizens. Sometimes states are unwilling or lack the possibilities to fulfill these obligations, and thus scholars from different fields propose companies to fill this gap. In particular, multinational corporations are called upon to respect and protect human rights worldwide. This chapter demonstrates how the state, civil society, and business negotiate corporate responsibility for human rights in a parliamentary legislative process on a supply chain law. For this purpose, the article takes up important arguments of philosophical ethics, business ethics, legal studies, and political science, which have emerged as particularly prominent in the ongoing debate. The article demonstrates that in the parliamentary debate, questions of the scope of responsibility, the companies to be included, and which rights and goods are to be considered are of great relevance.

Philipp Richter, Benedikt Kapteina und Rolf Brühl: Do firms' political capabilities increase their R&D investments? Evidence for direct and contingency effects in the European Union, in: European Journal of Management, Volume 22, Issue 1, 2022, 108-127 (Download from SSRN).

Corporates’ political activities have been identifies as important for affecting firm-level innovation outcomes. The present study examines the ways these corporate political activities may influence innovation inputs. We draw on the capability literature to theorize a positive relationship between political capabilities (i.e., firms’ organizational and strategic capacities to conduct political activities effectively) and firm-level R&D intensity. Moreover, we theorize on the contingencies of this relationship. Our hypotheses are tested by using a hand-collected data set in the context of the supranational European Union. The results of the regression technique confirm that political capabilities are positively related to R&D intensity. Market dynamism positively moderates the relationship between political capabilities and R&D intensity, whereas industry concentration negatively moderates the relationship. At a higher level of abstraction, our study makes important contributions to our understanding of how and under what conditions political activities relate to corporate innovation.

Philipp Richter und Rolf Brühl: Shared service implementation in multidivisional or-ganizations: a meta-synthesis study, in: Journal of General Management, Volume 46, Issue 2, 2021, 73-90 (to the article). 

The purpose of this article is to explore shared service center (SSC) implementation. Shared service is a key concept by which corporations organize their resources. Research indicates that some organizations struggle with implementing SSC and sometimes entirely fail to implement them. Although prior research exploring the determinants of implementation success is relatively scarce, researchers have conducted several SSC implementation case studies. However, these valuable findings remain isolated in stand-alone case studies. We aggregated the results of these studies using a qualitative meta-synthesis to identify, extract, and synthesize variables, their interrelations, and their relationships to SSC success. The outcome is a theoretical model that describes which factors are important and how and why they are related to SSC success. Overall, we make important contributions to the growing SSC research by shedding theoretical light on SSC implementation. We also provide a set of propositions and make suggestions for future research.

Teemu Malmi, David S. Bedford, Rolf Brühl, Johan Dergård, Sophie Hoozée, Otto Janschek, Jeanette Willert, Christian Ax, Piotr Bednarek, Maurice Gosselin, Michael Hanzlick, Poul Israelsen, Daniel Johanson, Tobias Johansson, Dag Ø. Madsen, Carsten Rohde, Mikko Sandelin, Torkel Strömsten and Thomas Toldbod: Culture and management control interdependence: an analysis of complementary control choices to delegation in different cultural regions, in: Accounting, Organizations and Society, Volume 86, 2020, Article 101116 (to the article).

This study examines the influence of cultural regions on the interdependence between delegation of authority and other management control (MC) practices. In particular, we assess whether one of the central contentions of agency theory, that incentive contracting and delegation are jointly determined, holds in different cultural regions. Drawing on prior literature, we hypothesize that the MC practices that operate as a complement to delegation vary depending on societal values and preferences, and that MC practices other than incentive contracting will complement delegation in firms in non-Anglo cultural regions. Using data collected from 584 strategic business units across three Western cultural regions (Anglo, Germanic, Nordic), our results show that the interdependence between delegation and incentive contracting is confined to Anglo firms. In the Nordic and Germanic regions, we find that strategic and action planning participation operate as a complement to delegation, while delegation is also complemented by manager selection in Nordic firms. Overall, our study demonstrates that cultural values and preferences significantly influence MC interdependence, and suggests that caution needs to be taken in making cross-cultural generalizations about the complementarity of MC practices.

Richter, Philipp, Brühl, Rolf: Ahead of the game: Antecedents for the success of shared service centers, in: European Management Journal, Volume 38, Issue 3, 2020, 477-488  (to the article).

 Shared service centers (SSCs) are firms’ new paradigm for enhancing efficiency and effectiveness in business support activities. Studies show that firms with SSCs can reduce costs up to 30% compared to firms using conventional organizational concepts. Because previous research provides only a few descriptive case studies that comprehensively report how firms implement SSCs, our knowledge regarding antecedents for implementation success (IS) is scarce. This paper addresses this gap, identifies antecedents, and theorizes how they affect the IS of SSCs by drawing on dynamic capability view and organizational design literature. We test a set of hypotheses with survey data from 164 SSC managers in index-listed European firms. Our results show that dynamic capabilities—reshaping capability and IT capability—and the organizational structure of support activities are important antecedents of successful SSC implementation. Overall, we contribute to the shared service literature by shedding theoretical and empirical light on a hitherto largely neglected theme: the antecedents for the successful implementation of SSCs.