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Article
Publication date: 28 November 2018

Wonsuk Cha, Michael Abebe and Hazel Dadanlar

The purpose of this paper is to explore the relationship between a chief executive officer (CEO)’s personal engagement in broader societal causes (CEO civic engagement…

Abstract

Purpose

The purpose of this paper is to explore the relationship between a chief executive officer (CEO)’s personal engagement in broader societal causes (CEO civic engagement) and firm’s social and environmental performance.

Design/methodology/approach

A theoretical framework was developed based on upper echelons and stakeholder theories to argue that CEOs’ professional background characteristics can be closely related to firm-level social and environmental performance. Hierarchical OLS analysis was conducted using data from 178 large, publicly traded large US firms between 2010 and 2013.

Findings

Overall, the findings suggest that firms led by CEOs with active civic engagement are more likely to support various philanthropic efforts. Additionally, the findings suggest that firms led by civic-minded CEOs are more likely to support an active corporate environmental engagement by investing significant resources in various environmental causes. Contrary to the authors’ predictions, the level of CEO civic engagement was not a significant predictor of firm level community engagement activities.

Research limitations/implications

The findings extend current scholarly work on executive determinants of corporate social performance by highlighting the important role of CEOs’ personal engagement beyond studying CEOs’ demographic characteristics. Specifically, the findings that the CEO-civic engagements lead to higher degrees of corporate philanthropy and environmental performance show that CEOs’ civic engagement can go beyond what is considered symbolic executive actions.

Practical implications

The findings suggest that firms that seek to foster social and environmental performance in a meaningful way should recruit and retain CEOs that have a personal commitment to and engagement in various social and environmental issues and causes.

Originality/value

By empirically examining the effect of CEO civic engagement on corporate philanthropy, community involvement and environmental performance, this paper seeks to contribute to the scholarly conversation on the effects of CEOs in shaping the firm’s social and environmental engagement and addressing external stakeholder concerns.

Details

Social Responsibility Journal, vol. 15 no. 8
Type: Research Article
ISSN: 1747-1117

Keywords

Article
Publication date: 31 January 2018

Michael Abebe and Wonsuk Cha

This study explores corporate strategic orientations as important drivers of firms’ philanthropic engagement. Specifically, the purpose of this paper is to empirically…

Abstract

Purpose

This study explores corporate strategic orientations as important drivers of firms’ philanthropic engagement. Specifically, the purpose of this paper is to empirically examine the relationship between two broad corporate strategic orientations – domain offense (DO) and domain abandonment (DA) strategies – and the level of philanthropic engagement.

Design/methodology/approach

The authors propose that firms pursuing aggressive DO strategies are more likely to invest in corporate philanthropy as part of their market expansion efforts. On the contrary, firms pursuing DA strategies are less likely to invest in corporate philanthropy because of decreased slack resources, rather conservative external stakeholder expectations as well as a firm’s conscious decision to disengage with external stakeholders. Hierarchical multiple regression analysis was conducted using data from 122 publicly traded US corporations from 2008 to 2013.

Findings

The findings provided empirical support for a significant positive relationship between DO strategies (acquisition and strategic alliance intensity) and firms’ philanthropic engagement. However, the relationship between DA strategies (divestiture and plant/facility closing) and firms’ philanthropic engagement was not found to be significant. Overall, the findings indicated that philanthropic engagements along with carefully crafted DO strategies help firms expand their market presence.

Practical implications

Organizational leaders that systematically target philanthropic causes that effectively converge with important corporate strategies do benefit in the long run by achieving better brand equity and overall enhanced corporate reputation.

Originality/value

By empirically investigating the relationship between corporate strategic orientations and philanthropic engagement, this study contributes to the on-going scholarly discussion on the link between corporate strategies and philanthropic engagements.

Details

Management Decision, vol. 56 no. 3
Type: Research Article
ISSN: 0025-1747

Keywords

Article
Publication date: 20 November 2017

Earl Yarbrough Jr, Michael Abebe and Hazel Dadanlar

The purpose of this paper is to empirically examine the link between board of director composition and firm performance. Specifically, the paper argues that board…

Abstract

Purpose

The purpose of this paper is to empirically examine the link between board of director composition and firm performance. Specifically, the paper argues that board political experience influences the firm’s internationalization strategy as directors with significant political experience provide guidance, resources, and network access that enhance the firm’s international presence. The authors also posit that board political connections would be more helpful for firms operating in high-regulation industries.

Design/methodology/approach

The authors tested the predictions using data from 156 large US firms. Data on directors’ background were gathered from SEC proxy filings, while data pertaining to internationalization were obtained from Compustat and Mergent Online databases. Hierarchical moderated regression analysis was employed to empirically test the hypothesized relationships.

Findings

The findings provide strong support for the positive relationship between board political experience and the degree of firm internationalization. Contrary to the authors’ predictions, the level of industry regulation does not seem to significantly affect this relationship.

Research limitations/implications

Firms aggressively pursuing international strategy could benefit from having directors on their board with robust political experience. One of the limitations of the study is that the types of international activities for firms is not specified in the study as it might be in the form of joint-venture capacity, strategic alliances or for firms that might be born-global.

Originality/value

This study makes original contribution to the on-going research on board political activity and firm performance through internationalization strategy. The findings suggest that having directors’ with political experience is an important asset in influencing firm’s corporate strategy.

Details

Journal of Strategy and Management, vol. 10 no. 4
Type: Research Article
ISSN: 1755-425X

Keywords

Article
Publication date: 6 July 2020

Michael A. Abebe, Sarah Kimakwa and Tammi Redd

This paper contributes to research in social entrepreneurship by introducing a typology that describes four distinct types of social entrepreneurs based on the nature of…

Abstract

Purpose

This paper contributes to research in social entrepreneurship by introducing a typology that describes four distinct types of social entrepreneurs based on the nature of their lives and career experiences and the scope of their social engagement.

Design/methodology/approach

In order to build a typology of social entrepreneurs, inductive profile analysis and archival research design approaches were used. A large variety of social entrepreneur profiles that are available in prominent social entrepreneurship organizations such as Ashoka Foundation, Echoing Green, Schwab Foundation and Skoll Foundation were examined.

Findings

Using four types of social entrepreneurs from the typology, the authors developed a number of predictions as to how social entrepreneurs with an activist background may benefit more in the short term but possibly struggle in the long term given their attachment to their venture's “original” cause and lack of corporate/business experience.

Originality/value

By developing a typology of social entrepreneurs and discussing the implications of this typology for post-launch social venture performance, the paper advances the current understanding of social entrepreneurs and the performance of their ventures. Additionally, by focusing on social entrepreneurs as agents of social change, this paper sheds some light on who these entrepreneurs are, what kind of life and career experiences they had and what motivates them to engage in social entrepreneurship.

Details

Journal of Small Business and Enterprise Development, vol. 27 no. 4
Type: Research Article
ISSN: 1462-6004

Keywords

Book part
Publication date: 4 August 2015

Michael Abebe and David

Despite the extensive research on the determinants and consequences of firm growth, research focusing on how the actual process unfolds is still evolving. An important…

Abstract

Despite the extensive research on the determinants and consequences of firm growth, research focusing on how the actual process unfolds is still evolving. An important part of firm growth process research is entrepreneurial cognition. The purpose of this chapter is to explore the relationship between entrepreneurial cognition and firm growth intentions. Specifically, we propose a theoretical model of entrepreneurial cognitive interpretation and categorization of market information as it relates to firm growth intentions. Drawing from the strategic cognition literature in general and strategic issue interpretation literature in particular, we propose that entrepreneurs’ interpretation of market information as opportunity or threat, gain or loss, and controllable or uncontrollable influences their firm growth intentions. Furthermore, our theoretical model discusses the condition under which favorable interpretation of market information leads to higher growth intentions by incorporating insights from the Entrepreneurial Orientation (EO) construct. This chapter extends our understanding of firm growth processes by highlighting the important role cognitive interpretation and categorization play in facilitating or hindering entrepreneurial firm growth.

Details

Entrepreneurial Growth: Individual, Firm, and Region
Type: Book
ISBN: 978-1-78560-047-0

Keywords

Article
Publication date: 21 September 2012

Michael A. Abebe

Despite an improved understanding of the role of top executives in declining firms, research is still needed to explore the role of environmental scanning and strategy…

1137

Abstract

Purpose

Despite an improved understanding of the role of top executives in declining firms, research is still needed to explore the role of environmental scanning and strategy formulation processes in an organizational decline context. Drawing from the attention‐based view and the literature on environmental scanning, the purpose of this paper is to examine the relationship among executive attention patterns, industry dynamism and corporate turnaround performance in declining firms.

Design/methodology/approach

In order to test theoretically‐driven hypotheses, data were collected from 70 US manufacturing firms that experienced serious performance decline and subsequent performance turnaround between 1990‐2000. The hypothesized relationships among market‐related, input‐related environmental scanning, industry dynamism and corporate turnaround performance were tested using a moderated regression analysis.

Findings

The findings indicate that declining firms operating in dynamic industry environments tend to improve their turnaround performance when executives focus their attention more on market‐related sectors (i.e. customer, competitor and technological sectors). Conversely, the findings also indicated that corporate turnaround performance of declining firms seems to be adversely affected by a disproportionate focus on input‐related sectors of the task environment (i.e. suppliers and creditors).

Research limitations/implications

The paper's findings contribute to the ongoing corporate turnaround research by highlighting the important role executive attention patterns and selective perceptions play in improving the extent of corporate turnaround in declining firms. More importantly, the findings also indicate that environmental context (in this case dynamism) is a critical part of successful corporate turnaround since it dictates the impact of relevant external actors on the organization.

Practical implications

Executives of declining firms attempting turnaround may find it particularly useful, based on the paper's findings, to focus their attention and information search on specific aspects of the task environment in order to facilitate corporate turnaround. Such focus becomes especially necessary if the declining firm is operating in dynamic industries.

Originality/value

The paper contributes to the corporate turnaround literature by highlighting the importance of both executive attention patterns and environmental context in any successful turnaround attempt.

Article
Publication date: 11 May 2010

Michael A. Abebe

The purpose of this study is to empirically examine the effect of top management team (TMT) characteristics on corporate turnaround performance in declining firms under…

1918

Abstract

Purpose

The purpose of this study is to empirically examine the effect of top management team (TMT) characteristics on corporate turnaround performance in declining firms under conditions of environmental stability and turbulence.

Design/methodology/approach

Theoretical hypotheses were developed and tested using data collected from 98 US manufacturing firms that experienced performance decline and turnaround during the periods 1990‐1994 and 1995‐2000 respectively. Data were collected from the COMPUSTAT database and annual filings and analyzed using a moderated regression analysis.

Findings

The results of moderated regression analysis indicate an adverse effect of long organizational tenure on corporate turnaround, especially in turbulent environments. Hence, if was found that the effect of top team composition on corporate turnaround varies depending on the environmental context.

Research limitations/implications

The study contributes to the ongoing corporate turnaround research by examining the interplay between TMT characteristics and turnaround performance under different environmental contexts. Consequently, the findings of the study suggest that the environmental context in which declining firms operate matter just as much as the nature and characteristics of their top team in determining the success of their turnaround attempt.

Practical implications

The results of the study shed some light on corporate governance issues, specifically on the importance of matching top management change efforts in declining firms with the respective environmental context.

Originality/value

The study contributes to the corporate turnaround literature by addressing the recent call for research in the TMT‐turnaround relationship under environmental contingencies (i.e. environmental stability/turbulence).

Details

Leadership & Organization Development Journal, vol. 31 no. 3
Type: Research Article
ISSN: 0143-7739

Keywords

Article
Publication date: 7 August 2009

Michael A. Abebe

The purpose of this paper is to empirically examine the relationship between chief executive officer characteristics and corporate turnaround performance of declining…

1285

Abstract

Purpose

The purpose of this paper is to empirically examine the relationship between chief executive officer characteristics and corporate turnaround performance of declining firms attempting turnaround.

Design/methodology/approach

A sample of 60 US manufacturing firms that experience severe performance decline and turnaround from 1985 to 2000 are selected from a population of declining manufacturing firms in the COMPUSTAT database. Data on leadership characteristics are collected and analyzed using ordinary least square regression analysis and ANOVA.

Findings

The general findings of the study provide empirical support for the upper echelons theory that emphasizes leadership characteristics as predictors of organizational outcomes. More specifically, the findings suggest the strong and adverse influence of long executive tenure on corporate turnaround performance. The findings also indicate that executives with output‐related functional background positively influence corporate turnaround performance in declining firms attempting turnaround.

Research limitations/implications

The findings of this paper have important implications for corporate governance issues in declining firms attempting turnaround. In addition, the findings also lend further empirical support for the role of strategic leadership in shaping organizational outcomes especially under declining environmental conditions.

Originality/value

This paper contributes to the turnaround literature by providing empirical evidence on the role of strategic leadership in formulating and implementing turnaround strategies in declining firms. It also provides further support for the upper echelons perspective and strategic decision making.

Details

Journal of Strategy and Management, vol. 2 no. 3
Type: Research Article
ISSN: 1755-425X

Keywords

Article
Publication date: 6 March 2007

Michael A. Abebe

The purpose of this article is to examine the major determinants for adopting virtual integration strategy in organizations. The article also addresses the competitive…

3987

Abstract

Purpose

The purpose of this article is to examine the major determinants for adopting virtual integration strategy in organizations. The article also addresses the competitive implications of adopting virtual integration strategy.

Design/methodology/approach

The article proposes a theoretical model that shows the major internal as well as external factors for adopting virtual integration strategy. In addition, the article presents real‐world applications of this strategy to explain the adoption process.

Findings

Virtual integration is a viable strategy in industries characterized by rapid product innovations and a high degree of competition. Virtual integration enables information technology driven supply chain coordination.

Research limitations/implications

Future research efforts in this area should focus on testing empirically the proposed relationships between adopting a virtual integration strategy and firm performance using different industry categories.

Practical implications

Executives in a highly competitive, innovative and increasingly varying market demand may benefit from adopting virtual integration strategy. By doing so, firms can integrate their processes using information technology to be more customer‐responsive and competitive.

Originality/value

This article identifies the value of adopting a virtual integration strategy and highlights the major factors affecting the adoption of this strategy in organizations. Managers at medium and high‐level positions in particularly dynamic industries will most likely benefit from this article.

Details

Business Strategy Series, vol. 8 no. 3
Type: Research Article
ISSN: 1751-5637

Keywords

Article
Publication date: 28 October 2013

Michael Abebe and David Anthony Alvarado

The purpose of this paper is to empirically examine the relationship between founder-chief executive officers (CEOs) and firm performance. Specifically, the paper explores…

1334

Abstract

Purpose

The purpose of this paper is to empirically examine the relationship between founder-chief executive officers (CEOs) and firm performance. Specifically, the paper explores two opposing arguments on the performance implications of founder-CEO leadership. The first theoretical perspective argues that founder-CEOs positively contribute to firm performance since they bring passion, vision, and external legitimacy to the organization. The contrary resource-based perspective, argues that while founder-CEOs help in the early years of the firm, they become less effective as the firm evolves into a complex bureaucracy since they lack the necessary managerial skills.

Design/methodology/approach

In order to test these perspectives, the paper develops a matched sample of 82 US manufacturing firms and compared their performance using both accounting and market-based measures. Independent sample t-tests and analysis of variance were used to empirically test the opposing predictions. Data were obtained from the Mergent Online database as well as official proxy filings of sample firms.

Findings

The results of the data analysis indicate that there is a statistically significant performance difference between founder-led and non-founder led firms. Such performance difference is especially evident when the paper focusses on accounting-based firm performance measures such as return on assets and return on investment. Surprisingly, founder-led firms performed worse than those led by non-founder CEOs. The follow-up analysis indicates a significant difference in age and size among sample firms led by founders and non-founders such that founder-led firms tend to be younger and smaller in size.

Research limitations/implications

Unlike other studies in the literature that found a strong positive impact of founder-CEOs, the findings of the study provided empirical support for the resource-based explanation of founder-CEO impact on firm performance. Specifically, the findings reported here contribute to understanding the role of founder-CEOs in the context of executive succession, strategy selection as well as organizational evolution.

Originality/value

This study makes original contribution to the on-going research on strategic leadership by exploring the performance effect of founder-CEOs and the corresponding alternative theoretical explanations. In addition, the inclusion of both accounting and market-based (Tobin's Q) dependent variables provide a broader measure of firm financial performance.

Details

Journal of Strategy and Management, vol. 6 no. 4
Type: Research Article
ISSN: 1755-425X

Keywords

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