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Creative corporate culture and innovation

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  • Fiordelisi, Franco
  • Renneboog, Luc
  • Ricci, Ornella
  • Lopes, Saverio Stentella

Abstract

We identify creative companies by means of a textual analysis that hinges on the competing values framework. We show that a creative corporate culture is an important driver of innovation, as measured by the number of patents as well as the patents’ importance as captured by patents’ citations and market values. A portfolio of creative companies earns significantly positive annual four-factor alphas. We quantify potential biases that could be induced by the omission of relevant variables by formally examining coefficient movements after inclusion of controls.

Suggested Citation

  • Fiordelisi, Franco & Renneboog, Luc & Ricci, Ornella & Lopes, Saverio Stentella, 2019. "Creative corporate culture and innovation," Journal of International Financial Markets, Institutions and Money, Elsevier, vol. 63(C).
    • Handle: RePEc:eee:intfin:v:63:y:2019:i:c:s1042443118304190
    DOI: 10.1016/j.intfin.2019.101137
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    Cited by:

    1. Hasan, Tahseen & John, Kose & Teng, Haimeng & Wu, Qiang, 2024. "Creative corporate culture and corporate tax avoidance," The British Accounting Review, Elsevier, vol. 56(3).
    2. Bianchi, Nicola & Carretta, Alessandro & Farina, Vincenzo & Fiordelisi, Franco, 2021. "Does espoused risk culture pay? Evidence from European banks," Journal of Banking & Finance, Elsevier, vol. 122(C).
    3. Zaman, Rashid, 2024. "When corporate culture matters: The case of stakeholder violations," The British Accounting Review, Elsevier, vol. 56(1).
    4. Mukhamad Najib & Abdul Aziz Abdul Rahman & Abror Abror & Riani Rachmawati & Megawati Simanjuntak & Prita Prasetya & Dwi Suhartanto & Farah Fahma, 2021. "Leaders’ Support of Sustainable Innovation and Business Sustainability in Developing Countries: Evidence from Small and Medium Food Processing Enterprises," Sustainability, MDPI, vol. 13(23), pages 1-19, November.
    5. He, Jiaxin & Li, Jingyi & Zhao, Daiqing & Chen, Xing, 2022. "Does oil price affect corporate innovation? Evidence from new energy vehicle enterprises in China," Renewable and Sustainable Energy Reviews, Elsevier, vol. 156(C).
    6. Jae Wook Kim & Jin Hwa Rhee & Chul Hung Park, 2024. "How Does Digital Transformation Improve Supply Chain Performance: A Manufacturer’s Perspective," Sustainability, MDPI, vol. 16(7), pages 1-16, April.
    7. Ghosh, Debarati & Dutta, Meghna, 2022. "Environmental behaviour under credit constraints – Evidence from panel of Indian manufacturing firms," Structural Change and Economic Dynamics, Elsevier, vol. 63(C), pages 490-500.
    8. Araki, Michael E. & Bennett, Daniel L. & Wagner, Gary A., 2024. "Regional innovation networks & high-growth entrepreneurship," Research Policy, Elsevier, vol. 53(1).
    9. Chen, Xiaomeng Charlene & Jones, Stewart & Hasan, Mostafa Monzur & Zhao, Ruoyun & Alam, Nurul, 2023. "Does strategic deviation influence firms’ use of supplier finance?," Journal of International Financial Markets, Institutions and Money, Elsevier, vol. 85(C).
    10. Wongsinhirun, Nopparat & Chatjuthamard, Pattanaporn & Jiraporn, Pornsit, 2023. "Corporate culture and board gender diversity: Evidence from textual analysis," International Review of Financial Analysis, Elsevier, vol. 86(C).
    11. Hiep Ngoc Luu & Lan Thi Mai Nguyen & Kieu Trang Vu & Loan Quynh Thi Nguyen, 2023. "The impact of organizational culture on bank stability," Review of Quantitative Finance and Accounting, Springer, vol. 61(2), pages 501-533, August.
    12. Hasan, Iftekhar & Jackowicz, Krzysztof & Kowalewski, Oskar & Kozłowski, Łukasz, 2023. "Cultural values of parent bank board members and lending by foreign subsidiaries: The moderating role of personal traits," Journal of International Financial Markets, Institutions and Money, Elsevier, vol. 83(C).
    13. Caiazza, Stefano & Fiordelisi, Franco & Galloppo, Giuseppe & Ricci, Ornella, 2022. "Informal central bank communication: The role of investor memories," Economics Letters, Elsevier, vol. 217(C).
    14. Markéta Adamová, 2022. "The Influence of Corporate Culture on the Development of Employee Training System in Enterprises of the New Economy," Economics Working Papers 2022-02, University of South Bohemia in Ceske Budejovice, Faculty of Economics.
    15. Bin Yan Ding & Feng Wei, 2022. "Executive resume information disclosure and corporate innovation: Evidence from China," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 43(8), pages 3593-3610, December.
    16. Huimin (Amy) Chen & Bill B. Francis & Tahseen Hasan & Qiang Wu, 2022. "Does corporate culture impact audit pricing? Evidence from textual analysis," Journal of Business Finance & Accounting, Wiley Blackwell, vol. 49(5-6), pages 778-806, May.

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    More about this item

    Keywords

    Corporate culture; Creative companies; Creativity; Innovation; R&D; Textual analysis;
    All these keywords.

    JEL classification:

    • G23 - Financial Economics - - Financial Institutions and Services - - - Non-bank Financial Institutions; Financial Instruments; Institutional Investors
    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
    • L25 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Performance
    • O31 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Innovation and Invention: Processes and Incentives
    • M14 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - Corporate Culture; Diversity; Social Responsibility

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