Who Is Governing Whom? Executives, Governance, and the Structure of Generosity in Large U.S. Firms
How do senior executives and board members influence corporate philanthropy? How does the creation of structures to manage philanthropy, i.e. a corporate foundation, affect the influence of senior leadership?
Collaborative research with Professor Christopher Marquis
Published in Strategic Management Journal (2013)
Corporate philanthropy is a strategic activity over which senior leaders - both board members and executives - have significant discretion. Yet corporate philanthropy is often managed through a speciﬁc, differentiated organizational structure—the corporate foundation—that formalizes and constrains the inﬂuence of individual senior managers and directors on corporate strategy. Analysis of Fortune 500 ﬁrms from 1996 to 2006 shows that certain characteristics of senior leaders affect corporate philanthropic contributions: network centrality (for board members), CEO tenure, and gender (for both board members and senior executives). Our analysis also finds that structurally-differentiated corporate foundations constrain the philanthropic inﬂuence of board members, but not of senior managers, a result contrary to what existing theory would predict.
These ﬁndings advance understanding of how organizational structure and corporate leadership interact, by showing that organization structure can mitigate the influence of senior leaders on strategic activities over which they have high discretion. In effect, internal structure governs those actors charged themselves with governing corporate activities. This insight has important implications for organization design, suggesting that formal, differentiated organization structures can provide as a useful tool for ensuring the integrity of strategies over which senior leaders have significant discretion. Regarding corporate philanthropy specifically, our findings offer new guidance on how organizations can more effectively realize the strategic value of their corporate social responsibility activities.
Marquis, Christopher, and Matthew Lee (2013). Who is governing whom?: Executives, governance, and the structure of generosity in large U.S. firms. Strategic Management Journal 34(4): 483-487.
Download the article here as a Harvard Business School working paper.