Chapter 3: Justifying the Questionable: An Experimental Study of Executive Framing in Ambiguous Ethical Contexts

This chapter investigates how executives justify morally ambiguous choices by experimentally examining the interplay between strategic ambiguity, moral elasticity and contextual pressures. Advancing a behavioural strategy lens, we theorize strategic ambiguity as a legitimacy-management device that enables the cognitive integration of ethically responsible and questionable rationales (‘CSR–CSI rational blending’) via moral elasticity, and we specify performance pressure and stakeholder plurality as boundary conditions that amplify this pathway. A 2 × 2 between-subjects scenario experiment with 123 senior executives manipulates organizational performance (stable vs. declining) and external expectations (low vs. high), captures decisions between a costly prosocial investment and a questionable cost-saving alternative and measures ambiguity, elasticity and blended justification. Analyses indicate that strategic ambiguity increases rational blending; this effect operates indirectly through moral elasticity and is significantly stronger under high-performance pressure and high stakeholder plurality, as shown by conditional indirect effects and robustness checks. The findings reposition ambiguity from communicative ‘noise’ to an agentic cognitive resource through which leaders reconcile competing legitimacy demands, and they identify moral elasticity as the mechanism that translates framing into ethically ambivalent reasoning. This chapter contributes a moderated mediation account of executive sensemaking under moral complexity and reframes responsibility and irresponsibility as co-produced through interpretive work rather than treated as binary opposites. Practically, the results caution boards, investors and regulators to scrutinize ambiguity-laden narratives – especially under pressure – by requiring explicit articulation of ethical trade-offs, strengthening independent oversight in high-stakes decisions, and aligning incentives with transparent ethical reasoning rather than symbolic compliance.