This paper explores why certain companies become more receptive to social activists over time. We propose a three-step, dynamic process of interaction between activists and companies. A firms’ past openness to activist challenges shapes which firms are targeted by activism. This opportunity structure subsequently evolves as firms seek to defend themselves when challenged by adopting what we call social management devices, which are structures or practices meant to aid the firm in managing and promoting its social image. In turn, we contend that these devices alter firms’ internal political agenda and provide leverage to external activists, making firms more receptive to future activist advances. In this way, social management devices moderate the relationship between a firm’s past contentious interactions and its future receptivity to activist challenges. We test our theory using a unique longitudinal dataset that tracks the activist interactions and responses of three hundred large US firms from 1993-2009.
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