Corporate Sociopolitical Activism and Firm Value

Yashoda Bhagwat, Nooshin L. Warren, Joshua T. Beck, George F. Watson

Research output: Contribution to journalArticlepeer-review

143 Scopus citations


Stakeholders have long pressured firms to provide societal benefits in addition to generating shareholder wealth. Such benefits have traditionally come in the form of corporate social responsibility. However, many stakeholders now expect firms to demonstrate their values by expressing public support for or opposition to one side of a partisan sociopolitical issue, a phenomenon the authors call “corporate sociopolitical activism” (CSA). Such activities differ from commonly favored corporate social responsibility and have the potential to both strengthen and sever stakeholder relationships, thus making their impact on firm value uncertain. Using signaling and screening theories, the authors analyze 293 CSA events initiated by 149 firms across 39 industries, and find that, on average, CSA elicits an adverse reaction from investors. Investors evaluate CSA as a signal of a firm’s allocation of resources away from profit-oriented objectives and toward a risky activity with uncertain outcomes. The authors further identify two sets of moderators: (1) CSA’s deviation from key stakeholders’ values and brand image and (2) characteristics of CSA’s resource implementation, which affect investor and customer responses. The findings provide new and important implications for marketing theory and practice.

Original languageEnglish (US)
Pages (from-to)1-21
Number of pages21
JournalJournal of marketing
Issue number5
StatePublished - Sep 1 2020


  • corporate sociopolitical activism
  • event study
  • political activism
  • political ideology
  • screening theory
  • signaling theory
  • sociopolitical
  • stock market reaction

ASJC Scopus subject areas

  • Business and International Management
  • Marketing


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