Abstract
Although executives’ psychological attributes have been extensively studied in the strategy literature, we lack insights into the role of CEOs’ perception towards firms' prospects under specific crises and their impact in this field. This study investigates how such CEOs’ perceptions influence firm strategic change by linking and extending the upper echelons theory and the behavioral agency model. We also examine the moderating role of CEOs’ financial alignment with shareholders. By using S&P 100 firms in 2020, which is the year when an unanticipated pandemic crisis outbreaks, this study finds that CEOs with a higher degree of optimism will not implement more strategic changes. Besides, our empirical evidence confirms that incentive alignment that works well in normal times does not necessarily guarantee its function in times of external crisis, indicating that a higher financial alignment will not motivate CEOs to implement more strategic changes.
Sign-in/Register to access full text options 
Talk to us
Join us for a 30 min session where you can share your feedback and ask us any queries you have
Schedule a callDisclaimer: All third-party content on this website/platform is and will remain the property of their respective owners and is provided on "as is" basis without any warranties, express or implied. Use of third-party content does not indicate any affiliation, sponsorship with or endorsement by them. Any references to third-party content is to identify the corresponding services and shall be considered fair use under The CopyrightLaw.
