Experience-based Human Capital or Fixed Paradigm Problem? CEO Tenure, Contextual Influences, and Corporate Social (Ir)responsibility

Document Type

Article

Publication Date

6-19-2018

Publication Title

Journal of Business Research

Volume

90

First page number:

325

Last page number:

333

Abstract

There are both benefits and costs of CEO tenure. CEO tenure is an indication of firm-specific knowledge and experience (i.e., the human capital view); however, long CEO tenure may lead to a lack of flexibility (i.e., the fixed paradigm view). We examine the effect of CEO tenure on two of a firm's social outcomes-CSR and CSIR. If the human capital view holds, long CEO tenure will increase CSR and reduce CSIR. If the fixed paradigm view holds, long CEO tenure will reduce CSR and increase CSIR. We further propose that these relationships are amplified by contextual influences, such as market growth, resource availability, and CEO duality. Empirically, we found general support for the human capital hypothesis, such that extended CEO tenure itself does not increase CSR, but decrease CSIR. Furthermore, three contextual factors moderate the CEO tenure-CSIR relationship, yet only market growth moderates the CEO tenure-CSR relationship.

Keywords

CEO tenure; Contextual influences; Corporate social responsibility; Fixed paradigm; Human capital

Disciplines

Business Administration, Management, and Operations

Language

English

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