The Influence of Stakeholder Orientation on Corporate Development Activities

Corporate development activities refer to all activities related to firm growth strategies such as alliances, acquisitions, divestitures and internal development (Wang & Zajac, 2007; Zollo & Reuer, 2010). In an attempt to identify the antecedents of these strategic decisions, scholars put their attention on several factors such as the resources a firm controls (Lavie & Rosenkopf, 2006), its ownership type (Feldman, Amit, & Villalonga, 2016), its previous experience (Russo & Vurro, 2019), or the type of relationships the firm has created over time (Gulati, 1995).A growing number of studies focus the attention on the influence that the relational resources a firm developed with its internal and external stakeholders (Parmar et al., 2010) might have on corporate development activities. For instance, it has been found that a firm stakeholder orientation is positively associated to firm innovation (Flammer & Kacperczyk, 2016), to the acquisition behavior (Tong, Wang, & Xia, 2019) and to divestment activities. These results are not surprising, given the influence that firm stakeholder orientation has on the sources of competitive advantage (Eccles, Ioannou, & Serafeim, 2014) and on the characteristics of the resources developed by stakeholder-oriented firms. In this thesis, we wish to advance this emerging stream of research by investigating the influence of firm stakeholder orientation on its alliance propensity and on the likelihood of it being acquired. Specifically, the first paper analyzes the influence of stakeholder orientation on firm alliance propensity. We suggest that stakeholder orientation, mitigates exchange related hazards and facilitates the selection process in alliance formation. Results confirm the hypotheses submitted and, additionally, show that the effect of stakeholder orientation is more pronounced in opaque contexts and in situation in which is complicated to assess focal firm trustworthiness and openness to collaboration. In the second paper, we analyze the influence of firm stakeholder orientation on its likelihood to be acquired. We argue that a firm’s stakeholder orientation might influence its visibility, its potential for value creation, the complexity in assessing it, and, lastly, the integration strategies. We propose arguments for both a positive and negative relationship between a firm’s stakeholder orientation and its likelihood of being acquired. In addition, we hypothesize that the effect of firm stakeholder orientation of its likelihood of being acquired is moderated by the acquirer’ level of stakeholder orientation. We tested the hypotheses conducting firm- and dyadic- level analyses. Results at firm level provide support for the negative hypotheses, while results at the dyadic level display that this negative effect is mitigated by the acquirer degree of stakeholder orientation.By joining together the streams of literature on strategic alliances, target selection and stakeholder orientation, this thesis makes two contributions. First, our arguments and findings emphasize the critical role played by the way in which the firm manages the network of relationship in which is embedded, in addition to the considerations about the type of relationship a firm possess emphasized in previous research. In particular, it enriches recent discussion on the importance of complementing valuable resources with valuable approaches to collect those resources. In so doing, we contribute both to M&A and alliance literature and more in general to literature on corporate development Second, we contribute to the stakeholder theory literature. In particular, we advance existing knowledge on the outcome associated to the different strategies adopted to manage stakeholder relationships. By providing a deeper understanding of potential benefits and drawbacks of a stakeholder-oriented approach, we hope to encourage managers to increase the adoption stakeholder theory practices in their behavior.