CEO Activism and Firm Value

• 成果类型: Article
• 署名作者: Mkrtchyan, Anahit; Sandvik, Jason; Zhu, Vivi Z.
• 署名单位: University of Massachusetts System; University of Massachusetts Amherst; University of Arizona; Southern Methodist University
• 刊物名称: MANAGEMENT SCIENCE
• ISSN/ISSBN: 0025-1909
• DOI: 10.1287/mnsc.2023.4971
• 发表日期: 2024
• 页码: 6519-6549
• 关键词: CEO activism; Firm value; institutional investors

摘要

We investigate the increasingly common practice of chief executive officers (CEOs) taking public stances on social and political issues (CEO activism). We find that CEO activism stems from a CEO's personal ideology and its alignment with investor, employee, and customer ideologies. We show that CEO activism results in positive market reactions. Furthermore, firms with CEO activism realize increased shareholdings from investors with a greater liberal leaning, who rebalance their portfolios toward these firms. Our results suggest that investors' socio-political preferences are an important channel through which CEO activism affects equity demand and stock prices. Notably, CEOs are less likely to be fired when their activist stances generate positive market responses.