How Responses to Sexual Harassment and Moral Values Shape Investment Decision Making

ABSTRACT We conducted three experiments to examine how organizations' responses to sexual harassment influence individuals' investment decisions, and whether moral values moderate these effects. In Study 1, the organization either addressed or ignored a harassment case; in Study 2, it either retaliated against (or not) the reporting employee; and in Study 3, the perpetrator was either the CEO or a regular employee. In all studies, we found robust interactions between organizational culture and moral values—particularly fairness and harm. Individuals high in fairness were less willing to invest when the organization failed to address harassment (Study 1) or retaliated against the victim (Study 2), regardless of perpetrator role (Study 3). Individuals high in harm were less willing to invest when harassment was ignored (Studies 1 and 3). These patterns also extended to punitive behavior: stronger moral values increased participants' willingness to harm the organization. Overall, individuals with stronger fairness and harm values were more sensitive to how organizations respond to harassment, and this sensitivity shaped both their financial decisions and punitive intentions.