Understanding the Effects of Financial Compensation on the Repair of Interpersonal Trust: Evidence from fMRI in Favor of Forgiveness and Reward

Trust violations are ubiquitous in organizations, and one possible response to repair trust involves the provision of a financial compensation. To understand better the processes involved when repairing trust by means of... [ view full abstract ]

Trust violations are ubiquitous in organizations, and one possible response to repair trust involves the provision of a financial compensation. To understand better the processes involved when repairing trust by means of substantial (tangible) responses, we employed advanced techniques in cognitive neuroscience (fMRI). Participants placed in the scanner played the role of recipient in a series of dictator games with allocators who (unknown to them) were preprogrammed. Trust was violated through an unequal division of resources, while afterwards it was repaired by a financial compensation that restored equality. The results revealed that receiving a financial compensation after an unequal division resulted in increased activation in brain areas that have previously been associated with forgiveness (temporoparietal junction, superior and inferior frontal cortices, and anterior insula), and more generally with emotion regulation. Moreover, we also found activation in brain regions which have been associated with reward processing (anterior insula and striatum). The present findings as such support prior organizational theoretical analyses regarding the processes that make trust repair by means of substantive tangible responses effective: elicitation of forgiveness and rewarding experiences of repairing the relationship. Managerial implications for the relevance of financial compensation in restoring interpersonal trust are discussed.