Can Good Information Prevent Misconduct? The Role of Organizational Epistemic Virtues for Ethical Behavior

Abstract

This study explores epistemic virtue as a new lens to scrutinize organizational behavior. Organizational epistemic virtues are the qualities of organizations that support the creation, sharing, and retaining of knowledge. We study how well organizations handle information and if that can prevent organizational misconduct. We propose a theoretical framework to link epistemic virtue to the prevention of misconduct and test this model using data from 822 U.S. companies. These companies are scored on six epistemic virtues by analyzing over one million online employee reviews using natural language processing. We focus on the epistemic virtues of curiosity, epistemic beneficence, epistemic justice, epistemic integration, humility, and open-mindedness. We find that companies with these virtues engage in less corporate misconduct, measured in terms of the number of penalties imposed by government agencies. We also give practitioners a framework to assess the epistemic virtues of organizations.