Corporate reputation in the age of CEO activism

: exploring the occurrence, motivations, strategies, and effects of CEO activism on the perceived corporate reputation of German companies

Abstract

Politicizing our everyday lives and lacking trust in politics and the media have spotlighted companies, particularly CEOs, regarding political opinions. These changes have led to CEO activism, i.e., the socio-political positioning of CEOs on issues unrelated to their companies. CEOs in Germany also follow this trend, but the phenomenon has yet to be researched in depth here. To address this research gap, this study aims to find empirical evidence for CEO activism in Germany and the underlying motivations, strategies, and effects. Therefore, this study investigates the following research question: How is CEO activism practiced and perceived in large German companies, and how does this affect the company’s perceived corporate reputation? The research design of this study follows an exploratory, descriptive research strategy that consists of a mixed methods approach with a cross-sectional time horizon. Therefore, this study first conducts a quantitative content analysis of the social media posts of German DAX CEOs to examine the occurrence of CEO activism in Germany. This is followed by a content analysis of 14 semi-structured, qualitative interviews with CEOs and communication experts from large German companies to gain insights into their perceptions and deepen the understanding of the practice and perceived impact of CEO activism in the German corporate landscape. Key findings include that the occurrence of CEO activism in Germany is increasing but is still generally very low. Furthermore, German CEO activism appears to take on a weakened and modified form, as CEOs express themselves on socio-political issues but almost exclusively in a corporate context. While the participants in this study expressed both positive and negative views toward CEO activism, all participants saw clear risks in CEO activism for both the company and the CEO. Concerning the motivations for CEO activism, this study confirmed the results of previous studies, showing that personal beliefs and public attention are primary drivers for engaging in CEO activism. At the same time, however, it also showed that German companies rarely practice CEO activism strategically but predominantly spontaneously. Ultimately, this study shows that the effects of CEO activism on the perception of a company's reputation are weaker than previous research has suggested. While the public socio-political positioning hardly affects investors, shareholders, or consumers, the participants in this study perceived significant, positive effects on existing and future company employees.

Date of Award	17 Mar 2025
Original language	English
Awarding Institution	Universidade Católica Portuguesa
Supervisor	Patrícia Tavares (Supervisor)