Managers Of Firms Research Articles

How do corporate social responsibility and green information technology capital influence environmental performance? Investigating the role of top management teams' green commitment

PurposeThe information and communications technology (ICT) industry is revolutionizing the world. However, achieving net zero emissions and sustainable development goals is equally important. This study uses intellectual capital-based and natural resource-based theories to determine whether green information technology capital (GITC) mediates the relationship between corporate social responsibility (CSR) and environmental performance. The role of the top management teams (TMT) green commitment as a moderator between CSR and GITC is also hypothesized.Design/methodology/approachData were collected using multi-wave and multi-respondent strategies from 275 ICT firms to examine these relationships. Structural equation modeling was used for analysis.FindingsThe findings demonstrate that CSR significantly and positively impacts environmental performance, with GITC significantly mediating this relationship. Furthermore, the statistical results confirm that TMT’s green commitment significantly strengthens the connection between CSR and GITC.Originality/valueThe significance of TMT’s green commitment as a boundary condition that enhances the effectiveness of strategically aligned CSR practices provides novel theoretical insights to extend the CSR literature. Additionally, it offers practical implications for the managers of ICT firms, which are discussed in detail.

The nexus of supply chain managerial competence expectation and possession in the new era: the case of Vietnam

PurposeThe new era of supply chain management is characterised by key change drivers, e.g. Industry 4.0, and post-COVID-19 VUCA (volatility, uncertainty, complexity and ambiguity) business environment, in addition to the rising requirements for sustainability, responsiveness and customer centrism. An important and topical question in this context is what supply chain managerial competence logistics managers need to possess in order to enhance their individual performance in the new era. This question is addressed in this paper, which also explores the nexus of supply chain managerial competence expectation and possession upon which human resource development strategies are proposed accordingly.Design/methodology/approachThe survey research design is adopted to empirically examine logistics managers’ supply chain managerial competence in the new era, and the forward-backward translation process was strictly followed. Data were collected through a survey conducted with owners or managers of Vietnamese firms whose business is in the logistics and related business areas, and 269 valid responses were used for analysis.FindingsResults indicated that the proposed profile of four groups (foundation, core, specialist and technology-IT) and 38 competencies are valid and important to the individual performance of logistics managers in the context of Vietnam, which supports the tenet that logistics managers in the new era need to have a well-rounded profile of competencies, including those derived from contemporary change drivers. It was also found that the foundation competency group is perceived as more important than others, which is context specific given the current logistics development in Vietnam. Besides, it was also revealed that respondents in this research currently possess those competencies at a level which is lower than their perceived importance. An Importance-Possession (IPM) Matrix of Competency Development was mapped accordingly.Research limitations/implicationsThe generalisation of this study would require further empirical examination from similar studies in other contexts, i.e. in other manufacturing and service sectors as well as in other developing and developed countries where logistics development is at different stages.Practical implicationsThis research provides insights into the current competency profile of logistics managers in Vietnam, which can assist senior management with human resources development in their firms. Specifically, it is essential that Vietnamese logistics firms focus on providing education and training opportunities, both internally and externally, to enhance the level of possession of all competencies whose gaps between perceived importance and possession are the largest across the groups, especially those in the Maintaining Sustainably and Growing quadrants of the IPM.Originality/valueFirstly, this research introduces an improvised framework of logistics managers’ supply chain managerial competence adopting the contingency approach, contributing to expanding the body of knowledge on how the competency profile of logistics managers should be developed. Secondly, the IPM matrix of competencies introduced in this research can be used as both the conceptual and managerial tool to classify and prioritise competencies for various purposes, e.g. education, training and policy implementation based on the nexus of supply chain competence expectation and possession.

Unveiling the hidden risks of government subsidy reliance: evidence from stock price crashes

ABSTRACT We develop a novel index to quantify the extent to which firms’ key operations – such as investment, efficiency, innovation, and liquidity – depend on government subsidies . Using data from Chinese listed firms (2007-2021), we find that a 1% increase in this index is associated with a 2.6% rise in ex-post stock price crash risk, except for subsidies in the form of tax rebates. To address endogeneity, we employ a DID approach leveraging China’s anti-corruption campaignand an IV approach using proximity to subsidy offices and city-level fiscal capacity as instruments. The effect is stronger in financially constrained firms and those with lower institutional holdings. Robustness checks confirm these findings. Channel analysis identifies information disclosure quality and operational risk intensity as key mechanisms. Our results highlight hidden risks of government subsidies for stock price stability, offering practical insights for managers of subsidy-dependent firms and policymakers.

Fintech startups in Germany: firm failure, funding success, and innovation capacity

Fintech startups have set out to revolutionize the financial world. However, little is known about how successful and innovative these firms actually are. This paper investigates firm failure, funding success, and innovation capacity using a hand-collected dataset of 892 German fintechs founded between 2000 and 2021. We find that founders with a business degree and entrepreneurial experience have a better chance of obtaining funding, while founder teams with science, technology, engineering, or mathematics backgrounds file more patents. Early third-party endorsements and foreign partnerships substantially increase firm survival. We also establish the following stylized facts: (1) fintechs focusing on business-to-business models and which position themselves as technical providers prove to be more effective; and (2) fintechs competing in segments traditionally reserved for banks are generally less successful and less innovative. These results have important implications for the early-stage success management of fintech firms and the investment decisions of venture capital funds and government startup programs.

The impact of knowledge sharing on well-being at work − Is organizational learning capability a mediating link?

Purpose Well-being at work is a prime concern for learning organizations where work is knowledge-intensive and the need for updated learning exerts high work pressure. This study aims to examine the mediating influence of organizational learning capability in facilitating routine and novel knowledge sharing to foster employees’ well-being at work in Indian information technology (IT) organizations. This research explores whether the sharing of routine knowledge and novel knowledge contributes to employees’ well-being at work by enhancing organizational learning capability. Design/methodology/approach Using a quantitative approach, the authors collected data from 209 employees in IT organizations in India via a questionnaire survey. After verifying the reliability and validity of the data, the authors analysed the data using co-variance-based structural equation modelling using AMOS 26. Findings The results show that the indirect effect of routine and novel knowledge sharing on well-being at work was influenced by the mediating role of organizational learning capability. Routine knowledge sharing has a significant positive impact on organizational learning capability and well-being at work. While novel knowledge sharing positively predicted organizational learning capability, it did not have a direct impact on well-being at work. Moreover, organizational learning capability has a direct positive effect on employees’ well-being at work. Research limitations/implications The cross-sectional design of the study makes the cause-and-effect relationship difficult to conclude. Moreover, the use of self-report measures poses methodological biases. Thus, longitudinal studies with objective measurements are recommended. Future studies can examine the role of individual characteristics such as learning orientation and personality in the studied framework. Practical implications Employee well-being and organizational learning can be enhanced through knowledge sharing practices, promoted by human resource policies and leaders. This promotes on-the-job learning, reducing working hours for training and learning purposes. By fostering a culture of openness, mutual trust and networking, organizations can enhance their employees’ work−life balance and overall performance. Originality/value This paper addresses a paucity in the literature concerning the outcomes of knowledge sharing and factors that lead to well-being at work. Drawing on the learning-based well-being perspective and job-demand resource theory, this research pioneers the examination of the mediating effect of organizational learning capability in the link between routine and novel knowledge sharing and employees’ well-being in IT learning organizations in India. Findings of this study may help managers of IT firms boost organizational learning and improve knowledge workers’ well-being, thus helping to maximize their performance and enhance employee retention and welfare.

Remote Work and Digital Progressions during the Covid-19 Pandemic for Auditors and Financial Managers in Johannesburg, South Africa

The emergence of the Fourth Industrial Revolution (4IR) marks a significant transformation, introducing technological and digital advancements that are reshaping how work is conducted, largely through virtual platforms (Abe 2020: xviii). This shift is altering both the nature of work and traditional workplace concepts. While research acknowledges developments across various employmentsectors, the increasing reliance on virtual arrangements has yielded mixed outcomes. This paper argues that the 4IR, coupled with the Covid-19 pandemic, has blurred the boundaries between physical and virtual work environments, often rendering physical workplaces less relevant. This transformation holds the potential to significantly impact worker engagement and well-being. Using a qualitative research approach, 26 interviews were conducted with auditors and financial managers in Johannesburg-based firms. The exploratory findings revealed that the Covid-19 pandemic accelerated the adoption of digital accounting practices for auditors and financial managers working remotely. Moreover, working from home was a double-edged sword for the participants in this study, as they compared their experiences during and before the pandemic. The findings demonstrate that digital processing dictates how work isconducted in the accounting and financial sectors.

Entrenchment or Nepotism? The Trade-off between Accrual-Based and Real Earnings Management in Egyptian Family-Owned Firms

Entrenchment or Nepotism? The Trade-off between Accrual-Based and Real Earnings Management in Egyptian Family-Owned Firms

Unlocking the potential of prosocial motives in fostering environmental and social innovation: the roles of creativity-relevant skills and business moral values

Purpose While prosocial motives are found to be conducive to unique manager behaviors, the literature lacks empirical evidence on the relationships between prosocial motives and managers’ willingness to engage in environmental and social innovation (ESI) in business-to-business (B2B) firms and the boundary conditions that shape these relationships. This research endeavors to unlock the potential of prosocial motives in fostering ESI, while investigating the mediating roles of creativity-relevant skills and the moderating influence of business moral values. Design/methodology/approach Using a quantitative survey approach, we gathered insights from 242 managers within Australia’s food and beverage industry. The authors tested their hypotheses by adopting a covariance-based structural equation modeling approach. Findings First, prosocial motives drive the ESI behaviors of managers in B2B firms. Second, creativity-relevant skills act as the critical bridge connecting prosocial motives with ESI within the realm of B2B firms. Third, business moral values emerge as potent moderating, positively influencing the relationship between prosocial motives and “managers’ willingness to engage in social innovation” within B2B firms. Originality/value To the best of the authors’ knowledge, this is the first study examining the relationship between prosocial motives and social and environmental innovation and how this relationship is influenced by creative-relevant skills and business moral values.

Does the Islamic work ethic moderate the relationship between organizational culture and enterprise performance?

PurposeThe performance of business enterprises is an impetus to every nation’s growth and development, as they constitute a multitude of businesses in most countries in the world. While ethical crises in the workplace are causing serious depletion in organizational performance and, in some cases, leading to total bankruptcy and the collapse of business in a developing country. This study aims to empirically examine the interaction effect of Islamic work ethics (IWEs) on the linkage between organization culture (OC) and enterprise performance (EP).Design/methodology/approachThe survey method collected data from 531 managers of firms in the SME category of enterprises, using validated measurement instruments adapted from previous studies, and the data were quantitatively analyzed with Smart PLS SEM.FindingsThe results indicate that OC has a positive and significant effect on EP. The study also found that IWEs had a strong positive and significant impact on EP. The investigation revealed a significant effect of IWEs on the OC impact on EP. Therefore, we concluded that increased IWE practice will enhance the OC impact on EP.Originality/valueThis study contributes to the nexus of OC and EP as the first to investigate the interaction effect of IWE in an African context. Furthermore, the study suggests that if enterprise managers can exhibit Islamic work values, it will communicate and stimulate workers’ positive attitudes toward the organization. The creation of a harmonious and unethical behavior-free workplace environment would lead to improved enterprise performance. We presented theoretical and practical implications, along with recommendations for future research.

Washed away: industrial capital, labor, and floods

Abstract This study quantifies the dynamic impacts of floods on industrial capital and labor in India using a novel dataset combining geocoded flood events with firm facility-level data from 2000 to 2021. Employing a stacked difference-in-differences approach with carefully matched controls, we uncover persistent negative effects of floods on firms’ assets and employment, with striking heterogeneity across sectors and regions. In the post-flood period, we estimate declines from mean values in total assets of 46.1% (16.68 billion INR ≈ 225 million USD), employment of 49.0% (8.20 thousand workers), and the wage bill of 74.5% (5.52 billion INR ≈ 74 million USD). The sectoral impacts are highly varied: the information technology and communication, manufacturing, and utilities sectors experience significant declines in assets, while the financial services sector exhibits growth. Mapping the spatial distribution of flood events and industrial facilities reveals pronounced regional heterogeneity in flood exposure and economic impacts. Adding nuance to the empirical investigation of the “creative destruction” hypothesis, we find limited evidence of systematic capital reallocation toward better-performing sectors, suggesting instead that floods generate sector-specific impacts with varying recovery patterns. These findings challenge assumptions of rapid post-disaster equilibration and have important implications for policymakers and firm managers in developing sector-specific strategies to mitigate the adverse impacts of floods in an increasingly climate-uncertain world.

Diversification strategies for manufacturing essential COVID-19 products: a dialogue between regional preconditions and change agency

ABSTRACT This study explores company diversification processes triggered by the shortage of COVID-19 products in Spain during the pandemic. The phenomenon is interpreted through the lens of ‘regional opportunity spaces’. Regional preconditions (e.g., industry relatedness) and change agency are also explored, confirming the decisive influence of the former dimensions. The study was conducted from a multi-scalar perspective using mixed methods which included a skill-relatedness approach based on historical data and semi-structured interviews with firm managers and other representatives from sectoral associations and regional technology centres. Implications for regional development and resilience are discussed.

Unpacking role of environmental awareness in the triad relationship of religious commitment, environmental values and intentions in Indian textile industry

PurposeThis study aims to examine the relationship between religious commitment (RC), environmental values (EVs), behaviour intentions and awareness. In this study, EV is studied as a mediator between the relationship of RC and environmental behavioural intentions. Finally, this study examines the conditional effect of environmental awareness on this mediation.Design/methodology/approachThis study was conducted in the textile industry in Punjab, India. The sample for this study was 259 managers of different textile firms. The data was collected on standardised scales. Partial least squares structural equation modelling was used to examine the direct and indirect effects in this study.FindingsIt was found that the indirect effect between RC and environmental behaviour intention was significant through EV. This study confirmed that the mediation between the variables was moderated by environmental awareness.Practical implicationsBased on the tested model, textile organisations can improve their corporate social responsibility practices. This study highlights the importance of encouraging environmental awareness among textile industry employees, especially those with religious convictions, to reduce environmental impacts. It suggests ecological training, education initiatives and implementing eco-friendly policies.Originality/valueThis study provides a model based on social and psychological factors. The findings of this study can be applied in the textile industry to augment environmentally friendly behaviour among managers. The perspective of moderated meditation among the relationships of variables carries a unique value in this study. Furthermore, this study combines social factors like religion with environmental psychology within business settings. In this way, study carries a unique value.

Director Departure and Noncompliance With Securities Laws

ABSTRACTResearch Question/IssueThis study investigates director departures surrounding the actual commencement of noncompliance events when public perception of the wrongdoing is less likely to exist.Research Findings/InsightsUsing a manually constructed nonaccounting noncompliance dataset of the Securities and Exchange Commission’s enforcement actions and hand‐collected information on directors’ status and characteristics, this study finds that firms not complying with securities laws experienced significantly higher unexpected director departures than control firms during the period in which the noncompliance began. Outside directors, in particular, tend to leave in the pre‐noncompliance period but not in the post‐noncompliance phase. The findings are robust across propensity score–matched tests, conditional logistic regression, and when controlling for CEO turnover. Further exploration of the characteristics of departing directors provides insights into the dynamics of the internal governance mechanism. It shows that directors with a background in an area of specialized expertise tend to leave noncompliant firms. The evidence also suggests that power struggles between departing directors and managers in noncompliant firms might contribute to director departure.Theoretical/Academic ImplicationsThis study extends the literature aimed at unraveling internal governance mechanisms around firms’ negative events. Since there are several important points along the timeline of a negative event, providing evidence on director behavior around these points can offer deeper insights into internal governance mechanisms.Practitioner/Policy ImplicationsThis study provides unique evidence that there is an abnormal departure rate of directors before the commencement of firms’ wrongdoings. This departure is consistent with explanations that directors with an information advantage from a special background are likely to foresee that problems or power struggles between directors and managers are likely to induce the departure of a director who is in a relatively weak position. The findings offer insights for policy makers, suggesting that regulators may need to reflect upon the shortcomings of the current governance system and how to hold management accountable, rather than putting heavy emphasis on developing doctrines for directors’ duties.

Pricing Poseidon: Extreme Weather Uncertainty and Firm Return Dynamics

ABSTRACTWe empirically analyze firm‐level uncertainty generated from extreme weather events, guided by a theoretical framework. Stock options of firms with establishments in a hurricane's (forecast) landfall region exhibit large implied volatility increases, reflecting significant uncertainty (before) after impact. Volatility risk premium dynamics reveal that investors underestimate such uncertainty. This underreaction diminishes for hurricanes after Sandy, a salient event that struck the U.S. financial center. Despite constituting idiosyncratic shocks, hurricanes affect hit firms' expected stock returns. Textual analysis of calls between firm management, analysts, and investors reveals that discussions about hurricane impacts remain elevated throughout the long‐lasting high‐uncertainty period after landfall.

Millennial executives: effects of the age-inverse relationship in CEO–top management team on corporate misconduct in China’s construction industry

PurposeThis study examines whether and how the age-inverse relationship between the chief executive officer (CEO) and the top management team (TMT) affects corporate misconduct in China’s construction industry. Drawing on social identity theory, we propose that the age-inverse relationship in CEO–TMT may diminish their social identity and further decrease the likelihood of corporate misconduct in construction firms.Design/methodology/approachUsing a longitudinal dataset of firms in China’s construction industry covering the years 2003 through 2021, this study adopted a logit regression model with fixed effects.FindingsThe results show that the age-inverse relationship in CEO–TMT is negatively related to corporate misconduct. Further investigations suggest that performance feedback moderates the relationship between the age-inverse relationship in CEO–TMT and corporate misconduct. Firms with an age-inverse relationship between CEOs and TMTs are more likely to engage in fraudulent behavior when performance is above aspirations and less likely to commit fraud when performance is below aspirations.Research limitations/implicationsThe sample of this study is limited to China’s construction firms. Drawing on social identity theory, this study explores the relationship between the age-inverse relationship and corporate misconduct in China’s construction industry, which enriches the antecedents of corporate misconduct and contributes to CEO–TMT interface research within construction firms.Practical implicationsThis study provides a guideline for construction firms on how to regulate and reduce misconduct. It will offer insights into human resource arrangements within the management of construction firms in an aging context.Originality/valueConsidering that few studies explore fraudulent behavior of construction companies at the upper echelon level, this study focuses on a novel and new antecedent (i.e. age-inverse relationship in CEO–TMT) and its boundary conditions. The findings extend the research on corporate misconduct and strategic leadership in the construction industry.

Firm size as a moderator of stakeholder pressure and circular economy practices: Implications for economic and sustainability performance in SMEs

PURPOSE: This study examines the interplay between stakeholder pressure (internal and external), circular economy (CE) practices, firm size, and their impact on the sustainability and economic performance of Small and Medium sized Enterprises. This research underscores firm size as a key moderator in the relationship between stakeholder pressures and CE adoption, aiming to provide a comprehensive understanding of this dynamic in SMEs. METHODOLOGY: Based on a cross-sectional survey of 124 SMEs in Estonia, Latvia, and Lithuania, with respondents primarily being owners and managers of firms, a three-step approach tested the proposed model for CE practices. First, Confirmatory Factor Analysis (CFA) was used to ensure that the observed variables represented latent constructs. Second, Ordinary Least Squares (OLS) and Weighted Least Squares (WLS) regression methods were used to control for factors influencing CE adoption. Finally, the interaction terms assessed the moderating role of firm size. FINDINGS: The research shows that firm size moderates these effects, with external stakeholder pressure significantly influencing CE adoption more than internal pressure. These finding underscores how firm size shapes SMEs’ responses to stakeholder pressure when adopting CE practices. IMPLICATIONS: This study provides empirical evidence that stakeholder pressure significantly influences SMEs in the Baltic States to adopt CE practices, thus impacting economic and sustainability performance. Smaller firms can enhance CE practices by strategically managing stakeholders, whereas larger SMEs should align with external stakeholder expectations for more effective CE initiatives, leading to improved organizational performance. ORIGINALITY AND VALUE: This study demonstrates how stakeholder pressures drive CE practices and impact organizational sustainability and economic performance. Firm size plays a crucial role as a moderator amplifying the influence of external stakeholder pressure on CE practices.

Board governance and ownership structure as mechanisms to oversight earnings management: Insights from an emerging market

This paper investigates the effectiveness of board governance and ownership structures as mechanisms to mitigate earnings management in Palestinian non-financial firms. By analyzing the relationship between board effectiveness and ownership structure on earnings management across 27 companies listed on the Palestine Stock Exchange (PEX) from 2018 to 2022, the study employs multiple regression analysis to derive its findings. The study concludes that Palestinian non-financial companies participate in earnings management, often shaping financial statements to align with management objectives. Family ownership is identified as the most significant factor in reducing earnings management, as higher family ownership typically involves more oversight of management behavior. Board independence also plays a key role, as independent directors effectively monitor executive activities, enhancing performance. Companies audited by the Big Four experience less earnings management due to the quality audit services provided by these firms. Based on these findings, several recommendations are proposed: companies should increase board independence with a higher proportion of independent directors, reduce board size for improved communication, and ensure productive board meetings through structured agendas. Policies supporting family ownership structures and encouraging institutional investor involvement in governance could further enhance transparency. Additionally, engaging high-quality audit firms should be a priority due to their association with lower earnings management. Future research could explore cross-country comparisons, longitudinal studies on governance changes, sector-specific analyses, and qualitative studies on the motivations behind earnings management practices, providing deeper insights into the relationship between corporate governance and earnings management.

Green human resource management and sustainable performance: serial mediating role of green knowledge management and green innovation

Purpose The sustainable performance of manufacturing companies may commence with employees’ eco-friendly initiatives. The management is responsible for employee green initiatives, requiring the human resource department to develop and implement green strategies. Therefore, it is essential to investigate how green human resource management enhances sustainable performance among manufacturing personnel. This study aims to determine if the green knowledge management and green innovation of manufacturing employees serve as serial mediators in the relationship between green human resource management and sustainable performance. Additionally, if artificial intelligence facilitated the relationship between green human resource management, green knowledge management and sustainable performance. Design/methodology/approach The data were gathered from manufacturing firm managers and analyzed using partial least squares structural equation modeling. Findings The results indicated a notable and positive correlation between green human resource management and sustainable performance, green knowledge management and green innovation. Green knowledge management and green innovation exhibited significant positive correlations with sustainable performance. Additionally, green knowledge management and green innovation facilitated the connection between green human resource management and sustainable performance. This relationship was serially mediated by green knowledge management and green innovation. Furthermore, artificial intelligence moderated the relationship between green human resource management, green knowledge management and sustainable performance. Practical implications This study suggests that management can use study findings in decision-making to improve firms’ sustainable performance. Originality/value This study provides novel empirical evidence by investigating the mediation roles of green knowledge management and green innovation between green human resource management and sustainable performance through the lens of the natural resource orchestration theory.

National Governance Quality, Competition and Firm Investment

Abstract This study investigates how market competition affects firm investment and the moderating effect of national governance quality (CGI) on the relationship between competition and firm investment in research and development (R&D) and tangible assets. The sample consists of 16,493 observations from World Bank Enterprise Surveys (WBES) in 88 countries in 2016 – 2022. The regression results show that both the competition and the level of market competition encourage firms to invest more in R&D and tangible assets. The quality of national governance also adjusts the relationship between competition and firm investment. Notably, the better quality of national governance strengthens the relationship between competition and firm investment. However, it weakens the relationship between a higher degree of competition and firm investment. In addition, the marginal effects examination suggests that variations in the quality of national governance influence the relationship between competition and investment in R&D investment, which is more pronounced than tangible investment in the presence of at least one competitor. In conclusion, the relationship between competition and investment is moderated by changes in CGI, the starting level of CGI score, and the market structures. The empirical results propose some implications for firm managers and policymakers to boost investment and a transparent environment for firm investment.

Eyes on the Ball: Activist Campaigns and Management’s Response at the Operational Level

More than 45% of the S&P 500 have been the target of activist investors. As a major shareholder in the firms they target, activist investors’ campaigns raise concerns over the firm’s poor performance and pose a threat to management’s control over the firm. Prior research has found that activist campaigns have significant consequences, as management curtails long-term investments, divests businesses, and foregoes acquisitions. Strategic decisions at the corporate level, however, do not provide insight as to whether activist investors motivate management to improve the operational competitiveness of the firm. Our study seeks to address whether activist campaigns succeed in motivating management to improve the firm’s operational competitiveness. This represents an important issue since the firm’s operational practices are essential to its competitiveness and performance. Our study proposes and finds that firms targeted by activist investors seek new ways by which to improve the firm’s operational efficiency and effectiveness. In addition, the management of target firms shift their emphasis to tactics that can improve the firm’s operations in the short-term. We use a measure of operational competitiveness that provides detail and granularity at a tactical level, enabling us to compare and contrast how firms respond to activist investors at the operational level of the firm. Thus, our study provides important insights not previously found that activist campaigns motivate management to improve the firm’s operational competitiveness.