Changes in top management team strategies caused by the external financial environment
Leadership & Organization Development Journal
ISSN: 0143-7739
Article publication date: 7 September 2015
Abstract
Purpose
The purpose of this paper is to analyse whether the onset of the financial crisis caused changes in the influence of top management team (TMT) on corporate results.
Design/methodology/approach
The sample is comprised of the list of S & P 500 Index firms between 2002 and 2008. The study uses a longitudinal panel methodology applying a two-step GMM estimator system. This approach addresses potential unobserved heterogeneity, simultaneity, and dynamic endogeneity.
Findings
The primary results reveal that the onset of the financial crisis stimulated those TMTs with large teams and a high frequency of meetings to improve corporate performance, without leading to a reduction in corporate risk taking.
Originality/value
This study reveals that different environmental conditions call for different behaviour from TMTs to fulfil their responsibilities. This study also suggests changes in normative and voluntary guidelines for improving the quality of the TMT’s work.
Keywords
Acknowledgements
The authors acknowledge the financial support received from P1•1B2013-31 and P1•1B2013-48 projects through the Universitat Jaume I and Sustainability and Corporate Social Responsibility Master Degree (UJI – UNED).
Citation
Ferrero-Ferrero, I., Muñoz-Torres, M.J. and Fernández-Izquierdo, M.Á. (2015), "Changes in top management team strategies caused by the external financial environment", Leadership & Organization Development Journal, Vol. 36 No. 7, pp. 849-866. https://doi.org/10.1108/LODJ-02-2014-0019
Publisher
:Emerald Group Publishing Limited
Copyright © 2015, Emerald Group Publishing Limited