Assessing psychological and environmental factors influencing the long-term orientation of TMTs

Nischal Thapa and Puspa Shah

Journal of Advances in Management Research, 2023, vol. 20, issue 2, 265-290

Abstract: Purpose - This study identifies and examines psychological and environmental factors that influence the long-term orientation of top management teams (TMTs). Design/methodology/approach - Data on S&P 500 companies from 2011 to 2020 are collected from the Compustat database. Additional variables were measured through content analysis of earnings conference calls. This study used two-stage least squares regression with fixed effects to analyze the data and test the hypotheses. Appropriate diagnostic tests were conducted to ensure validity and eliminate endogeneity. Findings - The results indicate that a chief executive officer’s (CEO) promotion focus positively and significantly influences the TMT's long-term orientation. However, the influence of prevention focus is statistically insignificant. Furthermore, the results indicate that environmental hostility moderates both relationships. Practical implications - The TMT's long-term orientation can be improved through the insights provided by this study. Originality/value - To the authors’ knowledge, this is the first study to examine the collective effects of psychological and task environmental factors on the long-term orientation of the TMT. Additionally, this study sheds light on the internal dynamics of the top-management team.

Keywords: Long-term orientation; Regulatory focus; Environmental hostility; Upper echelon theory (search for similar items in EconPapers)
Date: 2023
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Citations: View citations in EconPapers (1)

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Persistent link: https://EconPapers.repec.org/RePEc:eme:jamrpp:jamr-02-2022-0029

DOI: 10.1108/JAMR-02-2022-0029

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