In this study, we examine the implications of competitive dormancy, defined as a situation in which a focal firm’s observed time span of inaction following its prior action has exceeded the firm’s typical duration between successive actions. We argue that competitive dormancy may be perceived as inconsistent with a rival’s expectations and may be associated with an interpretive process concerning the rival’s subsequent actions. Integrating expectancy violation theory (EVT) and competitive dynamics research, we propose that the relationship between a focal firm’s competitive dormancy and the likelihood of rivals’ subsequent actions varies with their relative market standing and strategic resource commitment. Using a sample of 78,055 daily observations from 28 firms across 14 industries from 2000 to 2017, we find support for our hypotheses.
As a reflection of their fundamental value systems, CEOs’ political ideology has come to be regarded as a major predictor of their strategic decision-making. Among the most persistent characterizations in this literature, liberal-leaning CEOs are considered to exhibit a distinct preference for evenhanded outcomes and pro-social corporate practices due to their ideological endorsement of equality—an association derived from the conceptualization of political ideologies along the motivated cognition perspective and routinely used to differentiate them from their more conservative peers. Yet, moral psychologists increasingly call for a broader understanding of the moral values differentiating liberals and conservatives. We therefore introduce moral foundations theory to the study of CEO political ideology, according to which liberal- and conservative-leaning CEOs differ in their focus on individual- versus group-centric concerns but, contrary to the existing consensus, should both endorse evenhanded outcomes and pro-social corporate practices. We find evidence for corresponding U-shaped rather than linear effects of CEOs’ political ideology in a sample of over 1,600 S&P 1500 CEOs. As such, we offer a novel theoretical perspective on CEOs’ political ideology and its organizational ramifications.
Prior research highlights the far-reaching strategic and governance consequences for firms targeted in activist hedge fund (AHF) campaigns. Yet, how target firm executives and directors can effectively defend against these campaigns remains underexplored. Drawing on impression management (IM) theory, we reason that executives and directors use discrediting in their public rebuttal letters to negatively influence shareholders’ evaluations of AHFs’ reputation. To nuance this prediction, we develop a taxonomy distinguishing between source-focused discrediting, which directly attacks AHFs’ reputation, and message-focused discrediting, which challenges the validity of AHFs’ claims to indirectly tarnish their reputation. We theorize that both discrediting subtypes enhance target firms’ defense success, particularly when deployed in combination. Adopting a temporal perspective on IM theory, we further argue that the effectiveness of discrediting diminishes as more time elapses between an AHF’s public attack and executives and directors’ rebuttal. A manual content analysis of 841 rebuttal letters issued during U.S. AHF campaigns (2000–2023) provides robust support for these predictions. Beyond contributing to shareholder activism research by offering new insights into the determinants of campaign outcomes, our study advances IM theory by conceptualizing discrediting as a multidimensional influence tactic and exploring its effectiveness and temporal dynamics in adversarial contexts.
