Most theorizing on the relationship between corporate social/environmental performance (CSP) and corporate financial performance (CFP) assumes that the current evidence is too fractured or too variable to draw any generalizable conclusions. With this integrative, quantitative study, we intend to show that the mainstream claim that we have little generalizable knowledge about CSP and CFP is built on shaky grounds. Providing a methodologically more rigorous review than previous efforts, we conduct a meta-analysis of 52 studies (which represent the population of prior quantitative inquiry) yielding a total sample size of 33,878 observations. The meta-analytic findings suggest that corporate virtue in the form of social responsibility and, to a lesser extent, environmental responsibility is likely to pay off, although the operationalizations of CSP and CFP also moderate the positive association. For example, CSP appears to be more highly correlated with accounting-based measures of CFP than with market-based ...

/pdf/corporate-social-and-financial-performance-a-meta-analysis-21bp3gts9c.pdf

Corporate Social and Financial Performance: A Meta-Analysis

Companies are increasingly asked to provide innovative solutions to deep-seated problems of human misery, even as economic theory instructs managers to focus on maximizing their shareholders' wealt

Misery Loves Companies: Rethinking Social Initiatives by Business:

In economics and management theories, scholars have traditionally assumed the existence of artifacts such as firms/organizations and markets. I argue that an explanation for the creation of such artifacts requires the notion of effectuation. Causation rests on a logic of prediction, effectuation on the logic of control. I illustrate effectuation through business examples and realistic thought experiments, examine its connections with existing theories and empirical evidence, and offer a list of testable propositions for future empirical work.

Causation and Effectuation: Toward a Theoretical Shift from Economic Inevitability to Entrepreneurial Contingency

This study examines the relationship between board diversity and firm value for Fortune 1000 firms. Board diversity is defined as the percentage of women, African Americans, Asians, and Hispanics on the board of directors. This research is important because it presents the first empirical evidence examining whether board diversity is associated with improved financial value. After controlling for size, industry, and other corporate governance measures, we find significant positive relationships between the fraction of women or minorities on the board and firm value. We also find that the proportion of women and minorities on boards increases with firm size and board size, but decreases as the number of insiders increases.

Corporate Governance, Board Diversity, and Firm Value

The central argument of network research is that actors are embedded in networks of interconnected social relationships that offer opportunities for and constraints on behavior. We review research on the antecedents and consequences of networks at the interpersonal, interunit, and interorganizational levels of analysis, evaluate recent theoretical and empirical trends, and give directions for future research, highlighting the importance of investigating cross-level network phenomena.

/pdf/taking-stock-of-networks-and-organizations-a-multilevel-1td56u54yb.pdf

Taking Stock of Networks and Organizations: A Multilevel Perspective

This study examines the relationship between demographic diversity on boards of directors with firm financial performance. This relationship is examined using 1993 and 1998 financial performance data (return on asset and investment) and the percentage of women and minorities on boards of directors for 127 large US companies. Correlation and regression analyses indicate board diversity is positively associated with these financial indicators of firm performance. Implications for both strategic human resource management and future research are discussed.

https://papers.ssrn.com/sol3/Delivery.cfm/corg_307.pdf?abstractid=416337&mirid=1&type=2

Board of Director Diversity and Firm Financial Performance

https://lib.dr.iastate.edu/cgi/viewcontent.cgi?article=1005&context=management_pubs

Researchers have been examining the effects of formal strategic planning on small firm financial performance for more than twenty years. Reviewers of prior studies have drawn differing conclusions ...

Effects of formal strategic planning on financial performance in small firms: a meta-analysis

Modern business is clearly conducted in uncertain contexts. Today's firms are faced with ever increasing international competitive pressures, unstable capricious markets, new and complex technologies, and with dramatic changes in society in general. Paramount among these changing contexts is the change in the management composition of firms due to women assuming management positions. The American work force is one of the most ethnically and gender diverse in the world (Cox and Smolinski, 1994). For firms, this diversity affords new opportunities and challenges. According to Nichols (1993), in this decade, women managers will redefine managerial work and will provide firms with opportunities to capitalize on the challenging contexts they face. Zellner (1994) further notes that women are starting new businesses at a rate nearly twice that of men, and are "bringing to the table" skills such as team building and employee development that are very much in tune with today's competitive realities. Our goal in this study is to provide conceptual arguments and empirically explore the firm-level relationships of women in management with financial performance outcomes. To this date, few studies have been directly concerned with firm-level financial performance issues. We will justify and build on the assumption that firms employing more women managers have probably done a better job of recruiting capable managers from the total available talent pool, and consequently will be in a better position to link with customers, employees, and other constituencies. Firms employing higher percentages of women are likely to perform better inasmuch as they are more progressive and more competitive because their management contingents more closely mirror the composition of existing markets. EXPLANATORY FRAMEWORK Rationale for these arguments is found in the "resource-based" theory of competitive advantage and strategy analysis (e.g., Barney, 1991, 1997; Grant, 1991). Basically, according to Barney (1997), resource-based theory argues that it is not industry structure that leads to competitive advantage and better performance. Rather, it is the ability to capitalize on and apply the firm's internal resources in uncertain and dynamic industry contexts. The theory proposes that firms are defined as sets or "bundles" of resources. Firms can develop strong competitive advantages by accumulating unique or difficult to duplicate bundles of resources, and these resources can allow firms to take advantage of environmental opportunities or counterbalance threats. Supportive of the theory, research by Robins and Wiersema (1995) indicated that the ability to build these advantages paid off in terms of return on investment. Barney goes on to say that human capital resources are key to competitive advantage. Employee and management capabilities are firm-level resources that are among the most sustainable and difficult for competitors to imitate. The notion of human resources being the key to competitive advantage is prominent in the current popular management literature. For example, writing of their collective experience with numerous company change efforts, Katzenbach et al. (1995) concluded that many firms have underutilized human resources in this modern era of international competition and organization change. The underutilized resources tend to include females and those of diverse racial and ethnic backgrounds who might otherwise bring different perspectives to the firm. By better utilizing the contributions of women and minorities, firms can become more creative and accepting of change. Katzenbach et al. contend that if fully tapped, it is this cadre of middle-level, diverse, change-oriented managers that sets the high performing firms apart from the others. Iles and Auluck (1993) found that diverse work forces were beneficial to firms because they facilitated team problem solving and synergy. The ability to manage diversity fostered the incorporation of various perspectives into organizational decision making, and firms that united a wider range of participants performed well. …

https://lib.dr.iastate.edu/cgi/viewcontent.cgi?article=1001&context=management_pubs

Women in Management and Firm Financial Performance: An Exploratory Study

(Tables and illustrations not shown) INTRODUCTION The relationship between strategic planning and organizational performance has been a subject of growing interest in the field of strategic management. Recent reviews have underscored the importance of the issue and have pointed to gaps in our knowledge of planning/performance relationships.' A basic comclusion of these reviews has been that few studies have adequately addressed the issue because of measurement and conceptual problems. Of particular importance has been the manner in which the independent planning variables have been operationalized. Few studies have measured strategic and operational planning in ways that can be replicated. Furthermore, the dependent variable, performance, has been measured many ways and has seldom been examined over relevant time periods. Additionally, the literature has clearly highlighted the importance of organization context and uncertainty in determining planning/performance relations. Indeed, strategic planning has been considered more or less salient due to organization type, relevant industry, and environmental uncertainty. The purpose of the present study is to partially address these concerns. The study examines strategic planning/ performance relationships for a stratified random sample of small firms in three major industry sectors over a three-year time period. It also is an investigation of the degree to which environmental uncertainty affects both strategic and operational planning. Specific issues addressed in the study include: (1) the relationships of strategic planning, and operational or functional area planning with performance over time for small businesses using a planning scale which measures degree of planning effort and degree of formality, as well as scales measuring functional area planning efforts; (2) and the differences in strategic planning/performance relationships and in environmental uncertainty in manufacturing, retail, and service sectors. Strategic Planning and Performance We conceive of a strategic plan as: a written long-range plan, which includes both a corporate mission statement and a statement of organizational objectives. A strategic plan includes strategies indicating how objectives will be accomplished. Strategic planning is also considered to provide the substance from which overall company performance can be controlled and measured. Operational planning, on the other hand, is defined as the setting of short-term objectives for specific functional areas such as finance, marketing, and personnel. Strategic plans are more general and have longer time horizons than do operational plans. Strategic plans normally cover a one-to-five-year time period, whereas operational plans cover periods of less than a year. Operational plans are expressed in more day-to-day terms. Operational plans might include written inventory and sales forecasts; and financial, human resource, and advertising budgets; for monthly or quarterly time periods. A number of early studies have suggested a simple positive relationship between formal strategic planning and organizational performance, and have generally concluded that planners outperformed nonplanners, the premise being that formal plans are superior to informal plans because the process of writing the plan forces ideas and objectives to be thought out. Indeed, a recent study by Robinson and Pearce suggests that the more sophisticated the planning process, the better the organizational performance. 7 Other studies suggesting a positive relationship between strategic planning and performance have been numerous. However, not all research has yielded positive results. Several recent studies have found either non-significant or negative relations. As an explanation of inconsistent findings, several reviews have concluded that variety in the measurement of strategic planning has precluded meaningful comparison of findings across studies. …

Charles B. Shrader

Papers

Board of Director Diversity and Firm Financial Performance

Board of Director Diversity and Firm Financial Performance

Effects of formal strategic planning on financial performance in small firms: a meta-analysis

Women in Management and Firm Financial Performance: An Exploratory Study

Strategic and Operational Planning, Uncertainty, and Performance in Small Firms