Reputational dynamic capability – What’s board got to do with it

Abstract

The power of intangible corporate assets, on disposal to board and management provide immense possibilities to enhance corporate performance. Dynamic capabilities and corporate reputation are the most salient of a kind, beside knowledge. While the relevant literature about both phenomena is ample, their synergic impact on the corporate performance is lacking. The main challenge of the paper is to seal this important gap by proposing an integrated framework of dynamic capabilities and corporate reputation. In particular, by examining the mediating role of corporate reputation in corporate interactions, the reputational capability is shaped to enhance the corporate sensibility to changes in its operating ecosystem, prior to its competition, therefore assuring corporate fitness. This new breed of dynamic capability is designed as a driver of the firm’s market and non-market based competitiveness. In order to empirically verify this new mechanism, the research results conducted in Croatia are presented. The model is designed as generic in nature, hence is suitable for applying to other intangible corporate assets and dynamic capabilities interaction analysis