Employee perspective on site accidents and corporate reputation in developing countries

The construction industry is prone to hazards and dangers, which cause severe accidents and lead to high fatality rates (Rostamzadeh et al. 2022). Construction site accidents have been categorised as contact, slip and strip, and fall-related (Kang and Ryu 2019). For instance, Rafindadi et al. (2022) used the analytical hierarchy process (AHP) model to identify five sub-factors for fall-related accidents in construction sited. Studies have also categorised the causes of construction site accidents as management factors (Hamid et al. 2019; Al Zarooni et al. 2022; Birhane et al. 2022; Chan et al. 2022; Deng et al. 2022; Khanh and Kim 2022; Zeng et al. 2022) and unsafe job site conditions (Hassanain et al. 2022; Rahman et al. 2022; Zermane et al. 2022). Furthermore, the causes of construction site accidents are classified as worker-related, which are due to the actions of workforce (Bidhendi et al. 2022; Dolez et al. 2022; Kim and Kang 2022; Koc et al. 2022; Liang et al. 2022; Rafindadi et al. 2022; Wu et al. 2022).

Investigations on the Ghanaian construction industry have shown that Ghana is highly prone to accidents that lead to injuries and fatalities, despite regulations to control the phenomenon (Eyiah et al. 2019; Boadu et al. 2020). Thus, Kheni et al. (2010) noted that the rate of accidents in the Ghanaian construction industry is higher than the International Labour Organisation’s (ILO) estimate for emerging economies. Similarly, Osei-Asibey et al. (2021) noted that the national average for construction accidents in Ghana remains high and underreported due to the lack of safety officers.

Recent studies on construction safety and accidents in Ghana focused on construction safety culture (Sherratt and Aboagye-Nimo 2022), impacts of accidents and hazards (Osei-Asibey et al. 2021), health status of young construction workers (Frimpong et al. 2022) and health and safety knowledge transfer by Williams et al. (2021). These studies identified issues such as lack of education and training, prevalence of musculoskeletal disorders, substance abuse and mental health problems. The review of related studies on construction site accidents in Ghana indicates corporate reputation has received less attention.

There are several definitions of corporate reputation based on the context of scholarly investigations. However, Bigus et al. (2023) indicated that general definitions of corporate reputation exist in the literature. For instance, corporate reputation refers to the overall appeal or attractiveness of a firm ‘relative to that of its rivals’ (Lange et al. 2011; Fombrun 2012; Bigus et al. 2023, pp. 11). Some of the definitions of corporate reputation focused on stakeholders as demonstrated in Fombrun and Shanley’s (1990) definition of corporate reputation as a signal of a company’s status to stakeholders, while Saxton (1997) explained it as stakeholders’ perception of a firm’s key attributes or characteristics. Within the context of stakeholders, Dejong et al. (1985, p. 89) defined corporate reputation as the expectation of a principal regarding the future performance of ‘an agent’. Other studies refer to corporate reputation as stakeholders’ general view of a company’s ability to produce high-quality goods and services (Fombrun 1996; Kim et al. 2018); and the relative success of a firm by meeting the expectation of multiple stakeholders (Chalmers and Godfrey 2004). Corporate reputation is an intangible asset for attracting employees and stakeholders of organisations (Gu et al. 2022). Stakeholders and society perceive the identity of organisations through the lens of corporate reputation (Harvey et al. 2022). The focus of this study on employees as internal stakeholders in construction firms is appropriate as most of the definitions of corporate reputation cited in this article emphasise stakeholders. Thus, this study focused on a specific aspect of stakeholders, notably construction professionals, employed to execute various projects.

Corporate reputation creates competitive advantage and serves as a measure of quality leading to a positive image and survival of firms (Quintana-García et al. 2021). Activities undertaken to improve corporate reputation include quality management innovativeness, long-term investment, financial soundness, recruitment of talented people, responsibility to the community and environment and appropriate use of corporate assets (Choi et al. 2022).

Corporate reputation has been evaluated from different perspectives, notably leadership, quality of products, financial performance, employee behaviour and environmental and social responsibility (Zakerean 2021).

Bigus et al. (2023, p. 24) performed a systematic literature review and found that ‘there is lack of studies that measure stakeholders’ perspectives’ as a means of assessing a company’s attributes. Das et al. (2023) found that workforce agility, transformational leadership and talent management improve corporate reputation in the information technology sector. In a systematic literature review on corporate reputation in higher education, Mateus and Acosta (2022) found that scholarly contributions to the development of the theory are significant in the banking, service, retail, tourism and hospitality sectors and proposed a framework that focuses on the influence of stakeholders and benefits for improving it. The drivers of corporate reputation explored by Ghuslan et al. (2021) demonstrate that effective corporate reputation and the quality of both environmental and social reporting have a positive influence on corporate reputation. Similarly, Limbunan and Daromes (2022) found that managerial and corporate social performance influence corporate reputation of companies listed on stock exchange. On the contrary, the existing literature demonstrates that corporate reputation positively drives word of mouth, customer trust and satisfaction (Fatmawati and Fauzan 2021; Hasan and Hossain 2021). It is apparent that the prior studies on corporate reputation have not been undertaken with much focus on the internal stakeholders, notably employees in construction firms. This phenomenon is consistent with Mateus and Acosta (2022) and Das et al. (2023) who have earlier indicated the scope of corporate reputation investigations. Thus, this study on the influence of construction site accidents on corporate reputation is appropriate and timely.

Theoretically, this study is entrenched in the signalling theory, which deals with how the actions of firms send cues to stakeholders and influence them (Maden et al. 2012). According to the signalling theory, corporate reputation is perceived as an information that indicates the behaviour and quality of firm performance (Walker 2010). Activities of firms that tend to serve as cues or signals to stakeholders include strategic postures and social responsibility actions (Vander and d’Angelo 2022). Other aspects of the signalling theory include market signals, institutional signals and strategic signals (Zerbini 2017; Constantino et al. 2021; Salam and Jahed 2023). Market signals refer to unintentional information sent to stakeholders such as competitors, customers, suppliers, governments, bondholders and communities (Herbig 1996). The institutional signals are sent by organisations to influence the behaviour and attitude using logos, slogans and branding elements (Constantino et al. 2021). Strategic signals provide early warnings for future events and used to position the firm for potential changes in the environment (Carvalho 2021). Within the signalling theory, the sender is the organisation, while the receivers are the stakeholders. This study adapted the signalling theory because construction site accidents have the potential to send cues that portray a negative image of the construction firm with poor safety records on site.

According to Lee and Schuele (2010), the demographic information of participants demonstrates the representativeness of the target population. Thus, it is necessary to provide the demographic information of participants using Figures 1–4 to show the position, profession, academic background and work experience of respondents.

Fig. 1:

Fig. 2:

Fig. 3:

Fig. 4:

Figure 1 shows that study participants are managers, chief executive officers (CEOs) and staff of construction firms. In Figure 1, CEOs constitute 11% of respondents, while 7% of participants are managers. The majority of those involved in the study are staff of construction firms, representing 82% of participants. Figure 1 shows that the study involved the key segment of the target population in the investigation ranging from top management to those at the lower level of the organisational hierarchy of construction firms.

The study also delved into the professional background of respondents in which 26% project managers; 18% are quantity surveyors and engineers, respectively; and 16% are architects, as shown in Figure 2.

Furthermore, Figure 3 demonstrates the academic background of participants in which 14% have a master of science (MSc) degree and 40% obtained higher national diploma (HND)/diploma. Overall, the majority of the participants have a bachelor of science (BSc) degree in construction-related disciplines.

The majority of the respondents have considerable work experience, as shown in Figure 4. This indicates that the respondents have the requisite information that enable them to respond to issues regarding the effects of construction accidents on corporate reputation in construction firms.

The next section of the article focused on the descriptive analysis of the causes of construction accidents and their effects on the corporate reputation of construction firms, as given in Table 2.

Table 2 demonstrates that accidents on construction sites continue to occur despite the fact that numerous studies have been undertaken on this phenomenon. Table 2 shows that lack of attention leads to scaffolding accidents at construction sites, which has a weighted mean of 4.15 and ranked 1st among the 12 variables representing the causes of accidents on construction sites. Other critical issues that cause accidents on construction sites, as indicated in Table 2, include poor design, such as improper load location (dead loads), incorrectly constructed foundation or inadequate foundation for a given project leading to building collapse. Similarly, Table 2 indicates that lack of fall protection for workers on elevated structures causes accidents. The weighted mean values of all the 12 causes of construction accidents in Table 2 are above 3 and 4, indicating that the causes of accidents on construction sites remain a major a problem for professionals in the industry. The results in Table 2 are consistent with the findings of earlier studies on the causes of construction accidents by Rahman et al. (2022), Al Zarooni et al. (2022), and Hamid et al. (2019).

While a plethora of studies exist on causes of construction accidents, much of them have not received the needed attention in terms of their effects on the corporate reputation of construction firms. This article presents the results regarding the effects of construction site accidents on corporate reputation in Table 3.

At the descriptive level of analysis, the results show that the 17 variables in Table 3 affect corporate reputation of construction firms since their weighted means are above 3.5. Also, in Table 3, 12 of the impacts of construction accidents on corporate reputation have their weighted mean above 4.00, while 5 of them have a weighted mean above 3.00. This indicate construction site accidents are adversely affecting the corporate reputation of construction firms. For instance, Table 3 shows that loss of revenue leading to bankruptcy, delayed progress causing time and cost overrun, loss of productivity and low output, legal dispute in court for compensation and perception of the firm as not promoting wellbeing of workers are the highest ranked effects of construction site accidents on corporate reputation.

This study also delves into the correlation of the variables using the Pearson correlation, as shown in Table 4.

Pearson correlation was used to ascertain the relationship between causes of construction site accidents and their effects on the corporate reputation of the firms involved in this investigation. A Pearson coefficient of 1 shows a direct positive correlation between the variables. The test indicates a correlation factor of 0.745 in Table 4, which shows that causes of construction site accidents are related to its subsequent effects on corporate reputation shown in Table 3. This implies that construction site accidents have various effects on the corporate reputation of construction firms.

This section of the article focuses on identifying and categorising the common factors related to the causes of construction site accidents and corporate reputation. The communalities of the factor analysis were between 0.587 and 0.789, demonstrating that the variables explained the common factors for construction site accidents and corporate reputation. The factor analysis indicated five main components that had their initial eigenvalues above 1 for extraction, as shown in the scree plot in Figure 5.

Fig. 5:

The component matrix of the factor analysis shows that three variables have their factor loadings below 0.5, which were eliminated. The variables eliminated due to low factor loading consist of loss of lives creates shortage of skills, stop work orders (SWO) due to accidents and additional resources required to improve progress of work.

Corporate reputation and leadership are important to the managers of firms as it enhances the image and branding of organisations. Within the context of this study, the result in Table 5 shows that construction site accidents make it difficult for construction firms to achieve their organisational goals. In addition, accidents on construction sites lead to legal disputes in court, which affects the ability of leaders and managers to enhance the reputation of their organisations. The leadership and management component of corporate reputation are negatively affected by construction site accidents because it signals to stakeholders that the company prioritises profit over the welfare of employees and prevalence of poor site management practices. The finding pertaining to the effects of construction site accidents on leadership and management is consistent with the assertion of Willis et al. (2017) that environments with high exposure to accidents pose challenges to the leadership and management of construction firms. However, Wu et al. (2017) noted that improved leadership enhances construction safety; they have not been able to demonstrate the relationship between site accidents and corporate reputation dimensions identified using factor analysis in this study.

Organisational ethics consist of principles and guidelines firms adopt to determine the right behaviour and conduct of employees. The behaviour and conduct of employees on construction site can lead to accidents that will affect corporate reputation. Table 5 shows that frequent accidents at construction sites have the potential to make management to modify safety codes to hide non-compliance of safety practices culminating into unacceptable managerial conduct and behaviours in the organisation. Again, high rates of construction accidents tend to signal poor quality to the stakeholders, which leads to loss of credibility in construction firms. Existing studies such as Vander and d’Angelo (2022) and Heinberg et al. (2018) indicate that the actions and conduct of organisations serve as signals or cues that translate into either good reputation or bad reputation. Indeed, this study has indicated that construction site accidents are signals or cues to the stakeholders, which can have impacts on the ethical dimension of corporate reputation of construction firms.

In Table 5, four variables are loaded onto financial management component of corporate reputation. The two variables that are strongly associated with financial management element of corporate reputation include loss of revenue and bankruptcy due to inability to win contracts as a result of high rate of accidents. The second variable with a high factor loading under the financial management component of corporate reputation is loss of resources due to damaged equipment or plant, property, material and finished work during site accidents. This implies that resources and revenue lost due to accidents on sites negatively affect the credibility that stakeholders have for construction firms. Loss of productivity leads to low output, and project delay has a moderate association with the financial management component of corporate reputation. Within the resource-based view, corporate reputation is rare, valuable and immutable, which translate into financial resources (Roberts and Dowling 2002).

The result in Table 5 shows the two main effects of construction site accident on the shareholder value component of corporate reputation. These effects include loss of knowledge transfer opportunities through partnership with foreign firms and perception of the company as incompetent in managing occupational and organisational safety. In addition, rampant site accidents serve as unfavourable signals that make shareholders to perceive the company as not being able to create value for their investment. Raithel and Schwaiger (2015) found that superior corporate reputation creates wealth for shareholders due to the positive perception of the company. This study expanded the finding of Raithel and Schwaiger (2015) and Barney (2001) on corporate reputation and shareholder value by demonstrating that construction site accidents or lack of occupational and organisational safety undermines good corporate reputation, which subsequently affect shareholder value.

The result in Table 5 shows that construction site accidents affect the organisational sustainability component of corporate reputation. In this study, the effects of construction site accidents on the sustainability dimension of corporate reputation shown in Table 5 include site accidents leading to pollution of water resources creates negative image for the company, perception of the firm as not promoting wellbeing of workers, low self-esteem of workers and lack of motivation, and site activities leading to dirt and mud on local roads create bad image for the company. The results relating to pollution of water bodies and site activities disrupting access roads demonstrate issues relating to environmental sustainability, which are consistent with the results of the study by Choi et al. (2022) that identified responsibility to the community and environment as key components of corporate reputation. Thus, this study demonstrates the importance of environmental sustainability as a key aspect of corporate reputation and not only economic sustainability as far as corporate organisations are concerned.