Session 141

Politics as Usual? Political Ideology in the Excutive Suite and Boardroom

Track O

Date: Monday, October 5, 2015

 

Time: 11:15 – 12:30

Paper

Room: Director's Row H


Session Chair:

  • Yuri Mishina, Imperial College London

Title: Board Political Ideology and Actions: The Case of Financial Restatements

Authors

  • Uisung David Park, University of Washington
  • Warren Boeker, University of Washington
  • David Gomulya, Nanyang Technological University

Abstract: This study examines how the political ideology of the board of directors can influence their decisions and actions when the organization’s reputation has been damaged. We argue that politically conservative boards respond more assertively to reputation damage in order to reduce uncertainty and manage the threat posed by reputation loss. To investigate this process, we examine firms that were forced to restate earnings by the Security and Exchange Commission from 2003 to 2006 and find support for our argument that conservative boards are likely to take more decisive actions, such as replacing the CEO following a financial restatement. This relationship is shown to be especially strong when greater media attention is directed at the event. Our theory and findings contribute to research in corporate governance, upper echelon theory and the emerging literature on political ideology in business.

Title: Corporate Governance and Corporate Political Activity: Exploring the Impact of CEO Power

Authors

  • Ilir Haxhi, University of Amsterdam
  • Johan Lindeque, University of Applied Sciences and Arts Northwestern Switzerland
  • Stephen Zimmer, University of Amsterdam

Abstract: We explore the impact of corporate governance (CG) characteristics on corporate political activity (CPA). We argue that the firm’s preference for alternative CPA strategies will be influenced by the CEO’s relative power within the firm’s CG structure. We develop hypotheses linking different aspects of external, internal and financial power of the CEOs to the three CPA types, arguing that the CEO’s power impacts the CPA that corporations will pursue in terms of three alternative CPA strategies: information, financial and constituency-building. We have collected data for 297 US (SPX) listed firms for the years 2010 and 2012. We find partial support for our conceptual model, suggesting a more complex and nuanced understanding of the determinants of CPA than previously thought as a result of CEO power.

Title: Managers' Political Ideology and Inequality among Subordinates: Evidence from Capitol Hill

Authors

  • Seth Carnahan, University of Michigan
  • Brad Greenwood, Temple University

Abstract: We examine whether a manager’s political ideology, i.e. his or her position on the liberal-conservative continuum, correlates with the levels of inequality that we observe among his or her subordinates. Using data from 2001-2012 on the compensation of subordinate staff of members of the US Congress, we find that more liberal representatives tend to have flatter compensation structures and less gender inequality (measured by the number of women employed, the probability that those women occupy leadership roles, and differences in pay of men and women of similar rank) than conservative members. Robustness tests, including analysis of a website which posted all salaries online in 2006, help us soften concerns that these patterns are driven by politicians catering to voters’ preferences.

Title: Red, Blue and Purple Firms: On Coherence and Implications of Organizational Ideology

Authors

  • Abhinav Gupta, University of Washington-Seattle
  • Forrest Briscoe, Penn State University
  • Donald Hambrick, Penn State University

Abstract: Management researchers have widely noted the importance of organizational ideologies for firm behavior, yet little systematic research exists on how to conceptualize and measure organizational ideologies. This study aims to energize research on this topic by providing proof-of-concept for one promising approach. We introduce political conservatism-liberalism as a potent, parsimonious and generalizable conceptualization of ideologies of corporations. We propose a novel, reliable and replicable measure of organizational ideology based on political contribution by employees. Through multiple tests, we demonstrate that our measure has desirable statistical properties. We assess the measure’s predictive validity by investigating its association with the corporate adoption of socially progressive practices. We distinguish between the effects of organizational ideology and the effects of executive ideology.

All Sessions in Track O...

Sun: 08:00 – 09:15
Session 40: Strategic Leadership and Governance Expanding: Shifts and New Directions in Research
Sun: 09:45 – 11:00
Session 283: Editor Panel: Publishing Strategic Leadership and Governance Research
Sun: 11:15 – 12:30
Session 38: Big Game Hunting: Accessing and Interacting with Senior Executives for Empirical Research
Sun: 16:15 – 17:30
Session 139: Do Top Managers Matter? Expanding the Focus and Knowledge
Session 147: What Could Strategic IT Governance look like in Smart Cities?
Sun: 17:45 – 00:00
Session 324: Strategic Leadership and Governance Business Meeting
Mon: 08:00 – 09:15
Session 140: New Perspectives on the Outside Director Selection Process
Mon: 11:15 – 12:30
Session 141: Politics as Usual? Political Ideology in the Excutive Suite and Boardroom
Session 220: Perspectives on CEO Compensation
Mon: 13:45 – 15:00
Session 142: Top Management Teams, Senior Executives and Corporate outcomes
Session 215: Personality and Values in Strategic Leadership
Mon: 16:45 – 18:00
Session 216: Blame and Stigma in Response to Poor Orgnizational Outcomes
Session 218: Consequences of Top Management Attitudes and Orientations for the Firm
Tue: 08:00 – 09:15
Session 217: Leadership and Governance in Family Firms
Session 309: Looking Good and Sounding Better: Impression Management by CEOs
Tue: 11:00 – 12:15
Session 145: Strategic Leadership and Corporate Strategy
Session 214: Director Attributes, Director Actions and Director Effectiveness
Tue: 14:15 – 15:30
Session 146: Gender and Diversity in Strategic Leadership and Governance
Tue: 15:45 – 17:00
Session 219: A Tough Crowd: Critical Examinations by Owners and Stakeholders
Tue: 17:30 – 18:45
Session 144: Board Structure: What Works Best?
Session 189: Antecedents and Consequences of CEO Incentives


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