In Search of Meaning: Does the Fortune Reputation Survey Alter Performance Expectations?

Our study theoretically and empirically examines performance antecedents and consequences of the Fortune annual Survey of Corporate Reputation. Accountingand market-based measures of performance are used to predict the ratings, and investor reactions to the publication of the ratings are predicted to be associated with the extent to which the ratings diverge from antecedent predictions. Lower-than-predicted ratings should generate a negative response while higher-than-predicted ratings should generate a positive response. Contrary to expectations, we found a negative relationship. In addition, this negative relationship was only for the lowerthan-predicted ratings. For higher-than-predicted ratings the relationship with investor reaction was insignificant. Rbsumb

[1]  Vernon J. Richardson,et al.  The Market Valuation of Corporate Reputation , 2000 .

[2]  Abagail McWilliams,et al.  Event Studies In Management Research: Theoretical And Empirical Issues , 1997 .

[3]  Mathew L. A. Hayward,et al.  Explaining the Premiums Paid for Large Acquisitions: Evidence of CEO Hubris , 1997 .

[4]  Peggy A. Golden,et al.  THE EFFECT OF REPUTATION ON THE DECISION TO JOINT VENTURE , 1997 .

[5]  J. Barney.  Gaining and Sustaining Competitive Advantage , 1996 .

[6]  John W. Slocum,et al.  The impact of prior firm financial performance on subsequent corporate reputation , 1996 .

[7]  B. Brown,et al.  REMOVING THE FINANCIAL PERFORMANCE HALO FROM FORTUNE'S "MOST ADMIRED" COMPANIES , 1994 .

[8]  Gerald E. Fryxell,et al.  The Fortune Corporate 'Reputation' Index: Reputation for What? , 1994 .

[9]  E. Fama,et al.  Efficient Capital Markets : II , 2007 .

[10]  C. Fombrun,et al.  What's in a Name? Reputation Building and Corporate Strategy , 1990 .

[11]  D. Davidson.  On Corporate Reputation: A Reply to Dobson , 1990 .

[12]  Gregory G. Dess,et al.  Industry Effects and Strategic Management Research , 1990 .

[13]  Ben S. Branch,et al.  Perceptions of Firm Quality: A Cause or Result of Firm Performance , 1990 .

[14]  Danny Miller,et al.  The Icarus Paradox: How Exceptional Companies Bring About Their Own Downfall , 1990 .

[15]  Colin Camerer,et al.  Reputation and corporate strategy: A review of recent theory and applications , 1988 .

[16]  J. March,et al.  Managerial perspectives on risk and risk taking , 1987 .

[17]  Kenneth R. MacCrimmon,et al.  Taking Risks, the Management of Uncertainty , 1987 .

[18]  J. Dutton,et al.  Categorizing Strategic Issues: Links to Organizational Action , 1987 .

[19]  Jerold B. Warner,et al.  Using daily stock returns: The case of event studies , 1985 .

[20]  Terry E. Dielman,et al.  Pooled Cross-Sectional and Time Series Data: A Survey of Current Statistical Methodology , 1983 .

[21]  A. Tversky,et al.  Prospect Theory : An Analysis of Decision under Risk Author ( s ) : , 2007 .

[22]  A. Tversky,et al.  Prospect theory: analysis of decision under risk , 1979 .

[23]  M. Porter,et al.  From Entry Barriers to Mobility Barriers: Conjectural Decisions and Contrived Deterrence to New Competition , 1977 .

[24]  E. Fama.  EFFICIENT CAPITAL MARKETS: A REVIEW OF THEORY AND EMPIRICAL WORK* , 1970 .

[25]  C. Perrow.  Organizational Prestige: Some Functions and Dysfunctions , 1961, American Journal of Sociology.

[26]  J. Muth.  Optimal Properties of Exponentially Weighted Forecasts , 1960 .