Does Entrepreneurial Orientation Create Value for Stakeholders? Lessons Learned from S & P 500 Companies

Sara Ann Antony


Scholars have developed stakeholder theory as an alternative to shareholder theory to explain today’s increasingly turbulent and globalized business environment. Stakeholder theory suggests that a business must engage its stakeholders such as customers, suppliers, communities, employees, and financiers, which then creates value for shareholders. In this study I am exploring the extent to which five dimensions of entrepreneurial orientation (autonomy, competitive aggressiveness, innovativeness, proactiveness, risk-taking) affects value creation stakeholder engagement, while controlling for five other influencers (company size, unabsorbed slack, absorbed slack, dynamism, munificence). Using three archival sources: the Kinder, Lyndenberg, and Domici database, Compustat, and shareholder letters to operationalize all the variables within the research model, I constructed a sample of 314 S & P 500 firms (1504 firm-year observations) from years 2009-2013 to examine the extent to which these firms pursued value creation stakeholder engagement with respect to six stakeholder types: community, customers, diversity, governance (shareholders), employees, and the environment. I employed generalized estimating equations, which is well suited for longitudinal and panel-correlated count data. My preliminary results suggest the following relations to value creation stakeholder engagement: risk-taking is positively related with respect to communities, innovativeness is positively related with respect to customers, autonomy and risk-taking are negatively related with respect to customers, proactiveness is positively related with respect to governance, competitive aggressive and proactiveness are positively related with respect to diversity, innovativeness is positively related with respect to employees, innovativeness is positively related with respect to the natural environment, and risk taking is negatively related with respect to employees. Our results show that strategic orientations and corporate cultures have an effect on stakeholder value creation, and the effect varies based on the type of stakeholders. These results have significant implications for potentially improving value creation through organizational strategic management, as well as contributions to economic sustainability research.


Value Creation for Stakeholders; Entrepreneurial Orientation; Sustainability

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