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Experience-based human capital or fixed paradigm problem? CEO tenure, contextual influences, and corporate social (ir)responsibility

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  • Oh, Won-Yong
  • Chang, Young Kyun
  • Jung, Rami

Abstract

There are both benefits and costs of CEO tenure. CEO tenure is an indication of firm-specific knowledge and experience (i.e., the human capital view); however, long CEO tenure may lead to a lack of flexibility (i.e., the fixed paradigm view). We examine the effect of CEO tenure on two of a firm's social outcomes-CSR and CSIR. If the human capital view holds, long CEO tenure will increase CSR and reduce CSIR. If the fixed paradigm view holds, long CEO tenure will reduce CSR and increase CSIR. We further propose that these relationships are amplified by contextual influences, such as market growth, resource availability, and CEO duality. Empirically, we found general support for the human capital hypothesis, such that extended CEO tenure itself does not increase CSR, but decrease CSIR. Furthermore, three contextual factors moderate the CEO tenure-CSIR relationship, yet only market growth moderates the CEO tenure-CSR relationship.

Suggested Citation

  • Oh, Won-Yong & Chang, Young Kyun & Jung, Rami, 2018. "Experience-based human capital or fixed paradigm problem? CEO tenure, contextual influences, and corporate social (ir)responsibility," Journal of Business Research, Elsevier, vol. 90(C), pages 325-333.
    • Handle: RePEc:eee:jbrese:v:90:y:2018:i:c:p:325-333
    DOI: 10.1016/j.jbusres.2018.05.034
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    References listed on IDEAS

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