Purpose

This article aims to examine the influence of chief executive officer (CEO) internal political beliefs on labor relations. Prior research has paid little attention to channels through which the internal personal value system of managers enhances or deteriorates firm value. The authors provide evidence consistent with CEOs adopting labor policies impacting incumbent management–labor relationships based upon their political ideologies.

Design/methodology/approach

The research design tests the impact of CEO political ideology on labor relation using an individual CEO’s personal information and firm affiliation, employee lawsuit information, financial contributions to candidates and committees, and firm financial information. The authors compiled a sample of 4,354 unique CEOs from 2,558 US firms that are covered by ExecuComp and used 18,404 firm-year observations for the study’s analysis. A Heckman two-stage estimation process is used to address a potential sample selection bias and match the requirements of exclusion and relevance criteria.

Findings

Findings indicate that firms led by Republican-leaning CEOs are more likely to be sued by their employees, especially for violating union rights. Moreover, the findings of the study uncovered that Republican-leaning CEOs have fewer cases dismissed or withdrawn compared to Democrat-leaning CEOs and are also less likely to settle court cases prior to trial. Results indicate that Republican-leaning CEOs are associated with more substantial decreases in firm value compared to Democrat-leaning CEOs when facing labor allegations. The authors further show that firm value is lower for all firms facing litigation, with the magnitude of the decrease being more pronounced for firms with Republican CEOs.

Research limitations/implications

Firm affiliations are identified using ExecuComp, employee lawsuit information from the National Labor Relations Board (NLRB), financial contributions to candidates and committees from the Federal Election Committee (FEC) website, and financial information from Compustat. To the extent that these websites are inaccurate, such as financial contributions being underreported, the findings reported here may understate the relationships reported in this article.

Practical implications

The authors capture CEO political ideology using political contributions. There may be other means, such as physical space and personal effort, by which one could also estimate the party and intensity of CEO political ideology. This information is unavailable.

Social implications

While presidential politics has four-year cycles, managerial finance is a daily activity. While political affiliation is most clearly measurable through monetary contributions, one can see implications of manager political leaning through their relationship with labor throughout the election cycle.

Originality/value

The analyses of this study indicate that labor unions are more likely to sponsor lawsuits and stronger allegations in firms with Republican CEOs and show that withdrawal, settlement or dismissal rates are lower when firms are managed by Republican managers, resulting in higher subsequent legal costs and potentially damaged employee morale. Also, this paper investigates whether lawsuits have a greater negative consequence on firm value when the firm is run by a Republican CEO. The authors find that lawsuits significantly lower Tobin's Q for Republican-led firms compared to companies with Democratic and apolitical CEOs. The authors further show that firm value is lower for all firms facing litigation, with the magnitude of the decrease being more pronounced for firms with Republican CEOs.

中文翻译：

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CEO政治意识形态对劳动关系和企业价值的影响

目的

本文旨在考察首席执行官（CEO）内部政治信仰对劳资关系的影响。先前的研究很少关注管理者内部个人价值体系通过哪些渠道提高或降低公司价值。作者提供的证据与 CEO 基于其政治意识形态采取影响现任管理层-劳资关系的劳工政策一致。

设计/方法/方法

研究设计使用个人 CEO 的个人信息和公司隶属关系、员工诉讼信息、对候选人和委员会的财务贡献以及公司财务信息来测试 CEO 政治意识形态对劳资关系的影响。作者收集了来自 ExecuComp 涵盖的 2,558 家美国公司的 4,354 位独特 CEO 的样本，并使用了 18,404 家公司年度观察数据进行研究分析。Heckman 两阶段估计过程用于解决潜在的样本选择偏差并匹配排除和相关标准的要求。

发现

调查结果表明，由倾向于共和党的 CEO 领导的公司更有可能被员工起诉，尤其是因为侵犯了工会权利。此外，研究结果发现，与倾向于民主党的 CEO 相比，倾向于共和党的 CEO 被驳回或撤回的案件较少，而且在审判前解决法庭案件的可能性也较小。结果表明，在面临劳工指控时，共和党倾向的 CEO 与民主党倾向的 CEO 相比，公司价值的下降幅度更大。作者进一步表明，所有面临诉讼的公司的公司价值都较低，对于拥有共和党 CEO 的公司而言，下降幅度更为明显。

研究限制/影响

使用 ExecuComp、来自国家劳工关系委员会 (NLRB) 的员工诉讼信息、来自联邦选举委员会 (FEC) 网站的候选人和委员会的财务贡献以及来自 Compustat 的财务信息来确定公司隶属关系。如果这些网站不准确，例如低估了财务贡献，此处报告的调查结果可能低估了本文中报告的关系。

实际影响

作者使用政治捐款来捕捉 CEO 的政治意识形态。或许还有其他手段，比如物理空间和个人努力，也可以估计CEO政治意识形态的党派和强度。此信息不可用。

社会影响

虽然总统政治有四年的周期，但管理财务是一项日常活动。虽然政治派别可以通过货币捐款最清楚地衡量，但人们可以通过他们在整个选举周期中与劳工的关系看到经理政治倾向的影响。

原创性/价值

本研究的分析表明，工会更有可能赞助共和党 CEO 的公司提起诉讼和更有力的指控，并表明当公司由共和党经理管理时，退出、和解或解雇率较低，从而导致更高的后续法律成本，并可能导致员工士气受损。此外，本文还调查了当公司由共和党 CEO 经营时，诉讼是否对公司价值产生更大的负面影响。作者发现，与民主党和非政治首席执行官的公司相比，共和党领导的公司的诉讼显着降低了托宾Q。作者进一步表明，所有面临诉讼的公司的公司价值都较低，对于拥有共和党 CEO 的公司而言，下降幅度更为明显。