Top Management Team Risk Taking Propensities and Firm Performance: Direct and Moderating Effects
PDF

Keywords

Risk
Innovation
Stakeholder Satisfaction

How to Cite

Top Management Team Risk Taking Propensities and Firm Performance: Direct and Moderating Effects. (2002). Journal of Business Strategies, 19(2), 95-114. https://doi.org/10.54155/jbs.19.2.95-114

Abstract

We investigate the influence of top management team (TMT) risk taking
propensities on firm performance. Diverging from previous work on the risk
taking-performance relationship, we rely on perceptual (rather than archival)
measures of risk taking. In addition to financial performance, we examine
other performance outcomes of risk taking, such as innovativeness and
stakeholder satisfaction. Contrary to the findings of Bromiley (1991J and
Bowman (1980), we find that risk taking has a strong positive influence on
firm performance. In addition, the risk taking-performance relationship is
moderated by the dynamism of the firm's industry. More specifically, we find
that the benefits of TMT risk taking are reduced in more dynamic environments.

PDF

This article is distributed using a Creative Commons Attribution-NonCommercial 4.0 license. Copyright remains with the author(s).