Managerial Entrenchment and Corporate Social Performance

42 Pages Posted: 18 Jun 2008

See all articles by Jordi Surroca

Jordi Surroca

Universidad Carlos III de Madrid - Department of Business Administration

Josep A. Tribo

Stevens Institute of Technology

Abstract

We examine empirically the relationships amongst managerial entrenchment practices, social performance, and financial performance. We hypothesize that entrenched managers may collude with non-shareholder stakeholders in order to reinforce their entrenchment strategy; this is particularly so in firms that have efficient internal control mechanisms. Moreover, we prove that the combination of entrenchment strategies and the implementation of socially responsible actions have particularly negative effects on financial performance. We test these contentions with a sample of 358 companies, from 22 different countries, for the period 2002-2005.

Suggested Citation

Surroca, Jordi and Tribo Gine, Josep Antonio, Managerial Entrenchment and Corporate Social Performance. Journal of Business Finance & Accounting, Vol. 35, Issue 5-6, pp. 748-789, June/July 2008, Available at SSRN: https://ssrn.com/abstract=1147288 or http://dx.doi.org/10.1111/j.1468-5957.2008.02090.x

Jordi Surroca (Contact Author)

Universidad Carlos III de Madrid - Department of Business Administration ( email )

Calle Madrid 126
Getafe, Madrid, Madrid 28903
Spain

HOME PAGE: http://www.uc3m.es/uc3m/dpto/EMP/profesor/ijordi.htm

Josep Antonio Tribo Gine

Stevens Institute of Technology ( email )

Hoboken, NJ 07030
United States
9292708869 (Phone)
07030 (Fax)

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