Abstract:

Managerial authenticity relies on the perceived alignment between internal values and observable actions. Because values are unobservable, stakeholders must infer authenticity from behavior. We examine the implications of this inference process for social and economic performance by developing a game-theoretic model in which managers decide whether to invest in social goods, such as sustainability or employee working conditions. The model generates pooling, separating and semi-separating signaling equilibria that arise from the interaction between the cost of social action, the prevalence of altruistic managerial preferences and stakeholders’ valuation of authenticity. Our results specify when managers motivated by profit engage in strategic corporate social responsibility and when managers with altruistic preferences refrain from acting in line with their values. We show that authenticity is neither inherently moral nor uniformly beneficial but emerges as a strategic outcome shaped by internal preferences and external evaluations.

Please choose your submission type: Full Paper

Primary Track: Strategy

Keywords: strategy;corporate strategy;organizational strategy;Strategy

Menu

Prof Christian Asmussen