Agent-Oriented Impression Management: Who Wins When Firms Publicize Their New CEOs?

Abstract

In this study, we advance organizational impression management research by focusing on agent-oriented impression management—which reflects attempts to create value for the firm by publicizing individuals or groups who are agents of the firm. Although prevalent in practice, agent-oriented impression management remains unexplored in scholarly research. Specifically, we introduce the concept of new CEO prominence in firm communication (PFC), defined as the frequency and centrality of new CEO mentions in firm press releases and social media. We argue that new CEO PFC is distinct from traditional impression management tactics because CEOs are agents of the firm that will personally benefit from these impression management strategies. Thus, our research addresses the question: Who captures the value associated with new CEO PFC? We theorize that firms benefit from featuring new CEOs in firm communication through improved external stakeholder evaluations (i.e., analyst ratings). However, these efforts may also create value for the CEOs, as evidenced by increased compensation, more outside directorships, and decreased turnover rates. Our empirical study of efforts to publicize a new CEO following 557 succession events strongly supports our theory.