Publication Type
Journal Article
Version
publishedVersion
Publication Date
1-2024
Abstract
We provide large-scale empirical evidence of how much chief executive officers (CEOs) change corporate culture. To do this, we use employee reviews to measure corporate cultural change in S&P 1500 firms. In a variance decomposition analysis, we find a modest effect of CEOs on corporate cultural change. The effect of CEOs on cultural change is larger than industry effect but smaller than firm effect. Regression analysis in the context of CEO succession further shows consistent evidence of a modest effect of CEO succession on corporate cultural change. In addition, the relationship between CEOs and cultural change is not likely to be fully explained by time trend, reverse causality, sample selection bias, and omitted variable bias. An investigation into the contextual contingencies of the CEO-cultural change relationship suggests that succession characteristics, such as predecessor influence and turnaround situation, weaken postsuccession cultural change, but industry task environment has a weak moderation effect. Overall, our study contributes to the literature on strategic leadership and corporate culture.
Keywords
CEO effect, Corporate culture, Executive succession, Variance decomposition
Discipline
Strategic Management Policy
Research Areas
Strategy and Organisation
Publication
Organization Science
Volume
35
Issue
5
ISSN
1047-7039
Identifier
10.1287/orsc.2022.17210
Publisher
Institute for Operations Research and Management Sciences
Citation
LI, Xina; CHEN, Guoli; and SHEN, Rui.
Steering the intangible wheel: Chief executive officer effect on corporate cultural change. (2024). Organization Science. 35, (5),.
Available at: https://ink.library.smu.edu.sg/lkcsb_research/7787
Creative Commons License
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