Socially Oriented Shareholder Activism Targets: Explaining Activists’ Corporate Target Selection Using Corporate Opportunity Structures

Abhijith G. Acharya (), David Gras () and Ryan Krause ()
Additional contact information
Abhijith G. Acharya: Lee Kong Chian School of Business, Singapore Management University
David Gras: Haslam College of Business, University of Tennessee, Knoxville
Ryan Krause: Neeley School of Business, Texas Christian University

Journal of Business Ethics, 2022, vol. 178, issue 2, No 1, 307-323

Abstract: Abstract We examine whether and when socially oriented shareholder activists use firms’ corporate social performance (CSP) to identify them as attractive targets for their activism. We build on the research in social movements theory and stakeholder theory to theorize how firms’ engagement with primary and secondary stakeholders reflected in their technical and institutional CSP respectively allows socially oriented shareholder activists to identify targets. We develop a theoretical model by identifying corporate targets’ degree of (1) receptivity to and (2) need to comply with activist demands as two key dimensions of their corporate opportunity structure that explains the variance in firms’ attractiveness as targets for activist demands. We show that a firm’s technical and institutional CSP independently affect the likelihood of activists targeting the firm. We also show that our model has greater explanatory power at firms with high resource slack and from activists not identifying as socially responsible investment funds. Analysis of CSP and shareholder proposals data of 992 U.S. public firms over an 8-year window of observation largely supports our theory.

Keywords: Corporate opportunity structure; Corporate social performance; Stakeholder theory; Shareholder activism (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (5)

Downloads: (external link)
http://link.springer.com/10.1007/s10551-021-04785-5 Abstract (text/html)
Access to full text is restricted to subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:kap:jbuset:v:178:y:2022:i:2:d:10.1007_s10551-021-04785-5

Ordering information: This journal article can be ordered from
http://www.springer. ... cs/journal/10551/PS2

DOI: 10.1007/s10551-021-04785-5

Access Statistics for this article

Journal of Business Ethics is currently edited by Michelle Greenwood and R. Edward Freeman

More articles in Journal of Business Ethics from Springer
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().