Marketing

Quantum mechanics

Stakeholder theory

Public relations

Stakeholder management

Economics

Power (physics)

Mergers and acquisitions

Business

Corporate governance

Physics

Management

Political science

Organizational culture

Corporate social responsibility

Finance

Stakeholder

Shareholder

Journal of Corporate Finance

We investigate the predictive power of corporate social culture, as measured by corporate social responsibility (CSR) intensity, on shareholder wealth when mergers and acquisitions (M&As) are carried out by managers with different traits. We find acquiring firms with talented managers are more inclined to engage in CSR activities to shape corporate social culture, thereby realizing larger short- and long-term gains than their counterparts. We also document that acquiring firms with higher levels of CSR commitment led by talented managers tend to acquire targets of similar corporate social culture and experience significantly positive post-merger returns, suggesting that corporate cultural similarity constitutes an important source of M&A synergies. These findings suggest that corporate culture built through stakeholder relations acts as a differentiation strategy that pays off when skilled managers engage in M&As, which typically prompt information asymmetries between managers and outsiders.

Managerial ability, corporate social culture, and M&amp;As

Managerial ability, corporate social culture, and M&amp;As

Managerial ability, corporate social culture, and M&As