Corporate Culture
Paper Session
Sunday, Jan. 3, 2021 3:45 PM - 5:45 PM (EST)
- Chair: Paola Sapienza, Northwestern University
Sexism, Culture, and Firm Value: Evidence from the Harvey Weinstein Scandal and the #MeToo Movement
Abstract
During the Harvey Weinstein and #MeToo events, firms with a non-sexist corporate culture, proxied by having women among the five highest paid executives, earn excess returns of 1.6%. These returns are followed by positive revisions in analyst earnings forecasts. Returns for female-led firms increase to 3.2% in industries with few women executives, and 2.1% and 2.7% if headquartered in states with a high level of sexism or gender pay gap, respectively. Firms in industries with more women executives or headquartered in less sexist states also earn positive abnormal returns. Our evidence attests to the value of having a non-sexist culture.Shared Culture and Technological Innovation: Evidence from Corporate R&D Teams
Abstract
Given the increasing focus on workplace diversity and labor productivity in today’s economy, we open the black box process of corporate innovation production by examining the most important input into the firm’s R&D process, namely the individual employees tasked with developing new inventions. Using information on over two million inventors employed at U.S. public firms, we investigate how individual inventors’ inherited traits (cultural values and gender) and acquired career experiences affect their desire to collaborate with one another in a corporate R&D setting and how shared cultural values amongst R&D team members affects innovative output. We first provide novel evidence that, even amongst groups of comparably experienced inventors working in the same corporate office, inventors who share similar cultural values are 20% more likely to work together on new research projects. Second, using exogenous shocks to inventor team composition arising from premature co-inventor deaths, we find that more culturally homogenous teams produce a higher quantity of patents that are more likely to exploit existing technologies and become moderately successful inventions. In contrast, more culturally diverse teams produce a higher share of risky, more exploratory patents that have a greater chance of becoming high impact innovations. Our results have important implications for promoting different types of innovation in R&D intensive workplace environments and the likely effectiveness of diversity hiring policies.Hidden in Plain Sight: The Role of Corporate Board of Directors in Public Charity Lobbying
Abstract
Using IRS tax filings by public charities linked to lobbying disclosure and corporate board data, we show that charities with corporate directors on their boards spend more money on lobbying for the connected firms' industry interests. The effects of board connections are stronger when charities are connected to firms with greater lobbying expenditures or when charities are constrained on funding. We rule out spurious factors by controlling for firm-charity pair fixed effects, and address concerns of reverse causality using director turnovers as shocks to firm-charity connections. Consistent with quid-pro-quo relationships between firms and charities, we find that connected firms benefit from increased procurement contracts, and that connected charities receive more grants and donations. Our results highlight executive charitable engagement as a complementary avenue for corporate political activities.Discussant(s)
Elisabeth Kempf
,
University of Chicago
Renee Adams
,
University of Oxford
Danielle Li
,
Massachusetts Institute of Technology
Pat Akey
,
University of Toronto
JEL Classifications
- G3 - Corporate Finance and Governance