Punishment, Forgiveness and Moral Identity: A Valuable Relationships Perspective

Abstract

When and why do organizational actors, typically leaders, to opt to either punish or forgive a norm transgressor? Some scholars have suggested organization members either use punishment and forgiveness as management tools, that is, to ensure optimal organizational performance. Others have suggested that punitive and forgiving responses are mostly driven by moral concerns. In this paper, we integrate both perspectives by combining social cognitive theory of moral identity with the valuable relationship hypothesis. We argue that moral identity centrality predicts punitive and forgiving behavior that is optimal to ensure cooperation on the collective level. More specifically, over a series of three studies (two experimental studies and a field study), we show that moral identity centrality (vs. peripherality) is related to a higher sensitivity to relationship value. As such, we are the first to suggest and test a comprehensive framework that explains why responsible actors in organizations may choose to punish a transgression they may just as well have forgiven, or vice versa.