The Value of Corporate Culture

Guiso, Luigi; Sapienza, Paola; Zingales, Luigi

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The Value of Corporate Culture

CEPR Discussion Paper No. DP9716

48 Pages Posted: 8 Nov 2013

See all articles by Luigi Guiso

Luigi Guiso

Einaudi Institute for Economics and Finance (EIEF); Einaudi Institute for Economics and Finance

Paola Sapienza

Northwestern University - Kellogg School of Management - Department of Finance; National Bureau of Economic Research (NBER); Centre for Economic Policy Research (CEPR)

Luigi Zingales

University of Chicago - Booth School of Business; National Bureau of Economic Research (NBER); Centre for Economic Policy Research (CEPR); European Corporate Governance Institute (ECGI)

There are 2 versions of this paper

Date Written: November 2013

Abstract

We study which dimensions of corporate culture are related to a firms performance and why. We find that proclaimed values appear irrelevant. Yet, when employees perceive top managers as trustworthy and ethical, firms performance is stronger. We then study how different governance structures impact the ability to sustain integrity as a corporate value. We find that publicly traded firms are less able to sustain it. Traditional measures of corporate governance do not seem to have much of an impact.

Keywords: Corporate culture, Going Public, Integrity

JEL Classification: G30, Z1

Suggested Citation: Suggested Citation

Guiso, Luigi and Guiso, Luigi and Sapienza, Paola and Zingales, Luigi, The Value of Corporate Culture (November 2013). CEPR Discussion Paper No. DP9716, Available at SSRN: https://ssrn.com/abstract=2351323