Going Public and the Enrichment of a Supportive Network

Past research on initial public offerings suggests that the reputation of a company positively affects the success of the offering. Success is usually measured in financial terms as if the essence of the operation lay only in the short-term inflow of money. In this paper, we investigate important albeit often neglected implications of going public by combining evidence from a series of preliminary case studies taken from the results of a survey of 57 Italian initial public offerings. Evidence from our research suggests that, besides providing an important inflow of capital, going public may actually improve the reputational and social capital of a company, by increasing its visibility, prestige and perceived trustworthiness. Therefore, going public may be an important way to support entrepreneurial activity, as it may expand and reinforce the network of relationships that offer access to external resources, complementary skills and investment opportunities.     

Why Do Some Multinational Firms Respond Better Than Others to the Hostility of Host Governments? Proximal Embedding and the Side Effects of Local Partnerships

Using a multiple-case study of alleged expropriations reported before the World Bank, we examine how multinational companies (MNC) react to the escalating hostility of host governments. Our study reveals how different choices regarding the interaction with local nonmarket stakeholders – which we refer to as proximal vs. mediated embedding – shape how managers respond to these disputes by affecting their ability to collect, process and interpret information, and to act upon it in a way that effectively mobilizes local and international support. In contrast to the prevailing view that local partners in international joint ventures shelter MNCs from abuse from political authorities, our findings show that primary reliance on local partners to manage the local nonmarket environment can actually reinforce a liability of outsidership and even create a ‘liability of insidership’, to the extent that relying on local partners prevents the MNC from establishing quality connections with a broad range of nonmarket stakeholders, reducing its alertness and responsiveness to hostile acts from host governments.     

Exploring the Political Side of Board Involvement in Strategy: A Study of Mixed‐Ownership Institutions*

abstract This article reports on a comparative study of strategic decision‐making and board functioning in nine firms. Findings indicate that the heterogeneity of interests represented on the board, members' possession of relevant knowledge, and the presence of ex‐ante conflict resolution mechanisms combine in shaping if and how board members engage in strategy‐related activities and how strategic decisions are taken. Findings extend current understandings about the strategic functions of the board (monitoring, advice, and resource‐dependence), suggesting how, under certain conditions, boards may act as negotiation forums where directors search for a reconciliation between diverging shareholders' interests and views.     

Mediating Identity: A Study of Media Influence on Organizational Identity Construction in a Celebrity Firm

This paper reports a longitudinal field study on the effects of positive media coverage on the reconstruction of organizational identity. The study highlights how intense positive coverage – to the point of turning an organization into a ‘celebrity’– influences both the way members understand their organization (sensemaking effect) and the gratification they derive from its positive representation (self‐enhancement effect). Our findings suggest that positive media representations foster members' alignment around an emergent new understanding of what their organization is. Over time, however, celebrity may ‘captivate’ members' organizational identity beliefs and understandings, and impede further identity work as media persist in the replication of representations that differ from members' experienced reality, but are too appealing to them to be publicly contradicted.