| Author Name | ASAI Kentaro (Kyoto University) / HARADA Mitsuhiro (Tokyo Shoko Research) / KUBO Katsuyuki (Waseda University) / MIYAKAWA Daisuke (Waseda University) / YAMANOI Junichi (Waseda University) / YANAOKA Masaki (Tokyo Shoko Research) |
|---|---|
| Creation Date/NO. | September 2025 25-E-086 |
| Research Project | Firm Dynamics, Industry, and Macroeconomy |
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Abstract
Although private firms are not subject to discipline from capital markets, it remains unclear what factors deter them from engaging in organizational misconduct. Despite their numerical dominance, there is limited empirical evidence on misconduct by private firms and its antecedents. Using a unique dataset of administrative dispositions, representing the occurrence of organizational misconduct among Japanese private small- and medium-sized construction companies from 2010 to 2024, we empirically examine the factors that lead to such misconduct. Our analysis reveals that more mature firms and smaller firms are less likely to engage in organizational misconduct. Furthermore, we find that family firms are more prone to misconduct when they experience strong financial performance.
