Session Details: Session 1091

Impression Management

Track F

Date: Monday, October 13, 2008

 

Time: 17:00 – 18:15

Paper

Room: Salon 21


Session Chair:
Scott Graffin, University of Georgia

Title: Digging Out or Digging Deeper: The Roles of Reputation and Signal Cost in Impression Repair

Authors

  • Donald Lange, Arizona State University
  • Peggy Lee, Arizona State University
  • Mark Castleton, Arizona State University

Abstract: Organizations actively send signals and manage stakeholder impressions when the organization is associated with controversy. The type of impression repair tactic used will depend on situational and organizational characteristics. To better understand why an organization would use a particular tactic, we identify four primary categories of impression repair tactics and describe how conceptually they fall along three dimensions: firm reputation, seriousness of the controversy, and the cost of the tactic. Furthermore, we use these three dimensions to predict stakeholder reaction to impression repair tactics. We develop hypotheses and propose an empirical test of our theory using a sample of all SEC enforcement actions, 2002-2006. We will capture impression repair tactics using verbatim transcripts of statements made by the firm in response to the enforcement action.

Title: Muddying the Waters: How Firms May Intentionally Confound Shareholder Reaction to CEO Succession

Authors

  • Scott Graffin, University of Georgia
  • Mason A Carpenter, University of Wisconsin-Madison
  • Steven Boivie, Texas A&M University

Abstract: Our study examines the possibility that firms may release information which confounds, or muddy the interpretation waters, surrounding CEO successions. To test this idea, we examine two related questions. First, are CEO successions are confounded at a higher rate than one would expect by chance? Second, do investor, industry, or firm-level conditions impact the likelihood of firms muddying the waters? We examine the impact of stock analysts’ uncertainty, industry stability, managerial discretion, and recent firm performance on the likelihood that a firm’s CEO succession will be confounded by other significant organizational announcements. In closing, we discuss the possible implications of board composition and incentive structure for muddy waters, and outline a process for extending the theory developed here to incorporate the interests of these agents.

Title: The News Media as Purveyor of Public Status: Evidence From CEO Compensation

Authors

  • Mathew Hayward, Monash University
  • Markus Fitza, Frankfurt School of Finance and Management

Abstract: In this article we seek to extend and contextualize existing research about the impact of CEO press coverage on CEO status and compensation. We ask: What are the mechanisms and conditions that explain when media attention increases CEO compensation? Theoretically, we want to develop the impact of media stories on CEO status by evaluating the public strength of such signals for individuals who do not attract ready-made indicators of status. Our approach is to examine the status of the issuers and to examining more closely the uncertainty pertaining to the context in which the signal is received. We test our hypotheses with large-sample archival data on Standard and Poor’s 1500 firms, and a comprehensive database of press articles.

Title: The Reputation Halo and Compensation: Evidence from Major League Baseball

Authors

  • Peggy Lee, Arizona State University
  • Scott Graffin, University of Georgia
  • Andrew Ward, Lehigh University

Abstract: Organizational researchers have argued that the judgment of reputable third parties serves as a mechanism by which the capabilities of actors are assessed. Certifications are thought to influence an actor’s reputation by providing a signal regarding their capabilities. If an actor has been certified, observers may infer that the actor has intangible qualities which are not easily quantifiable in traditional performance metrics thus warranting a decoupling of pay from current performance. We examine how a prior positive reputation, created by the outcomes of certification contests, may create a reputation halo, resulting in higher compensation regardless of actual current performance. We show how reputation, garnered through certification contests such as All-Star appearances and Gold Glove Awards in Major League Baseball determines compensation, irrespective of current performance.

All Sessions in Track F...

Mon: 11:15 – 12:30
Session 1089: Make, Ally or Buy
Session 1096: Executive Compensation
Mon: 15:30 – 16:45
Session 1086: Alternative Views of Value Creation
Session 1090: CEO Pay
Session 1107: Executive and External Forces in Strategy
Mon: 17:00 – 18:15
Session 1091: Impression Management
Session 1098: Social Networks
Tue: 11:15 – 12:30
Session 1093: Succesion and Team Dynamics
Session 1103: Social and Human Capital
Tue: 14:30 – 15:45
Session 1095: Diversification
Session 1105: Governance Perspectives
Wed: 10:00 – 11:15
Session 1104: Managing Alliance Relationships
Session 1106: New Corporate Strategy Perspectives
Wed: 11:30 – 12:45
Session 1088: Acquisitive Growth Strategies
Session 1092: Dynamic Strategies and Resources


Strategic Management Society

Cologne Conference