Stakeholder Orientation and Divestiture Activity

Bettinazzi, Emanuele Luca Maria; Feldman, Emilie R.

doi:10.5465/amj.2019.0627

Cited by 30 publications

(23 citation statements)

References 77 publications

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“…As Phillips et al (2003) suggested, there is a lingering misconception that stakeholder theory argues for an equal weighting of stakeholder interests (Gioia, 1999;Marcoux, 2000;Reynolds et al, 2006;Sternberg, 1998). This idea is reinforced in the empirical literature because most studies use a composite measure of SMP that weighs stakeholders equally (e.g., Bettinazzi & Feldman, 2020;Bettinazzi & Zollo, 2017;Choi & Wang, 2009;Hillman & Keim, 2001). Hillman and Keim once argued that there is no theoretical justification for doing otherwise.…”

Section: Discussionmentioning

confidence: 99%

“…It is a significant predictor of both market-based and accounting-based firm performance, even in the presence of a traditional (composite average) measure of SMP, and could help explain why some previous research is not entirely supportive of the instrumental notion that SMP is positively related to firm performance (Mattingly, 2017). That is, most studies have been based on composite SMP measures, which could have masked the influence that the level of variation in those scores might have had on their models (Bettinazzi & Feldman, 2020;Bettinazzi & Zollo, 2017;Hillman & Keim, 2001).…”

Section: Discussionmentioning

confidence: 99%

“…A related problem is that empirical research often reinforces the balanced stakeholder perspective by measuring SMP with a composite measure, such as average performance across stakeholder groups, which gives them equal weight (e.g., Bettinazzi & Feldman, 2020;Bettinazzi & Zollo, 2017;Choi & Wang, 2009;Hillman & Keim, 2001). In their well-cited empirical study pioneering the averaging approach, because no theoretical work supports giving one stakeholder group a higher priority than another, Hillman and Keim (2001: 131) chose to give "equal importance" to each of the stakeholder categories in their study.…”

mentioning

confidence: 99%

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Evidence of an Inverted U–Shaped Relationship between Stakeholder Management Performance Variation and Firm Performance

et al. 2021

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Empirical research is largely supportive of the assertion of instrumental stakeholder theory that a positive relationship exists between “managing for stakeholders” and firm performance. However, despite considerable debate on the subject, the amount of variation across firm investments in stakeholders (stakeholder management performance) has not been adequately investigated. We address this gap using a sample of more than eighteen thousand firm-level observations over ten years. We find evidence to support an inverted U–shaped relationship between variation in stakeholder management performance and Tobin’s q, suggesting that firms that have some imbalance in their stakeholder management, but not too much, perform best. We discuss the implications of our study for instrumental stakeholder theory and managerial practice.

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Section: Discussionmentioning

confidence: 99%

Section: Discussionmentioning

confidence: 99%

mentioning

confidence: 99%

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Evidence of an Inverted U–Shaped Relationship between Stakeholder Management Performance Variation and Firm Performance

et al. 2021

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“…We normalized each of the five stakeholder categories' scores on a zero-to-one scale, and we aggregated them using the average. In doing so, we implicitly allocated equal importance to each stakeholder category, which is consistent with our underlying theory and prior research (Bettinazzi and Feldman, 2021;Bettinazzi and Zollo, 2017;Greenley and Foxall, 1997;Ni, 2020). The result is a measure of the degree of stakeholder orientation that is formative and ranges from zero to one.…”

Section: Variablesmentioning

confidence: 95%

Stakeholder Orientation and Experiential Learning: Evidence from Corporate Acquisitions

Bettinazzi

Zollo

2021

J Management Studies

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This article examines how stakeholder orientation influences managers’ ability to learn from prior experience in corporate acquisitions. We argue that increased attention to primary stakeholders’ signals affects both positively and negatively managers’ capacity to analyze causal mechanisms in past acquisitions, draw inferences from them, and apply these inferences to subsequent acquisitions. On the one hand, attention to stakeholders’ inputs may enhance managers’ ability to interpret prior experience by giving voice to unnoticed details of past acquisitions. On the other hand, it may divert managers’ attention away from inferential mechanisms, reinforce confidence in existing practices, and limit managers’ ability to learn from acquisitions experience. We combine these theoretical effects to propose an inverted U‐shaped influence of stakeholder orientation on the relationship between acquisition experience and focal acquisition performance. We also propose that experience homogeneity and proximity to the knowledge domain of the focal firm act as boundary conditions on this influence. Analyses of a sample of 4619 corporate acquisitions by 504 US firms support our predictions.

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“…Notable in this regard is Bettinazzi and Feldman's (2021) research on a relationship between stakeholder orientation and divestiture activity. According to them, firms are motivated to divest businesses when the costs of divesting to stakeholders are less than those of internally resolving stakeholder conflicts.…”

Section: Shareholder-oriented Practicesmentioning

confidence: 99%

From a shareholder to stakeholder orientation: Evidence from the analyses ofCEOdismissal in large U.S. firms

Shin

Lee

Bansal

2021

Strategic Management Journal

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The post-Enron era is marked with growing discourse of stakeholders, sustainability, and corporate social responsibility (CSR). Yet, commentators debate whether U.S. corporations have indeed moved toward a stakeholder orientation, given the difficulties in measuring such a shift. We assess this shift by examining corporate governance practices, especially the prevalence of shareholder-and stakeholder-oriented practices in chief executive officer (CEO) dismissals. Using data on large firms in 1980-2015, we found that, before the 2000s, CEOs were less heavily penalized for poor firm performance when they demonstrated a shareholder orientation by downsizing and refocusing the corporation and more heavily penalized for CSR activity. This trend, however, reversed after the early 2000s. This article provides evidence of the evolution of U.S. firms' governance practices from a shareholder toward stakeholder orientation. Managerial Summary: Many people are skeptical of the assertion that U.S. corporations have become more stakeholder-oriented over time. It is no wonder, as scant evidence exists for this claim. We tackle this claim head on by analyzing firm practices in 1980-2015 that contributed to chief executive officer (CEO) dismissal when the firm was performing poorly. Some practices, such as downsizing and firm refocusing, are associated with a shareholder orientation and others,

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Stakeholder Orientation and Divestiture Activity

Cited by 30 publications

References 77 publications

Evidence of an Inverted U–Shaped Relationship between Stakeholder Management Performance Variation and Firm Performance

Evidence of an Inverted U–Shaped Relationship between Stakeholder Management Performance Variation and Firm Performance

Stakeholder Orientation and Experiential Learning: Evidence from Corporate Acquisitions

From a shareholder to stakeholder orientation: Evidence from the analyses ofCEOdismissal in large U.S. firms

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