Shared Authentic Leadership and New Venture Performance

Abstract

This study applied affective events theory (AET) as a framework for understanding the relationship between the shared authentic leadership of new venture top management teams (TMTs) and the performance of their firms. Results, based on a national (United States) random sample of new ventures, demonstrated a positive indirect effect of shared authentic leadership behavior on firm performance, an effect that operated through TMTs’ positive affective tone. These findings contribute to entrepreneurship and strategic management literatures by illustrating that AET (a micro-level theory) is a conceptually relevant framework for understanding the impact of TMTs on firm performance (i.e., upper echelons theory and research). With respect to the leadership and organizational behavior literatures, the authors’ results indicate that authentic leadership may be particularly beneficial when shared among team members.