Recent Submissions

  • Systemic risk in the US: Interconnectedness as a circuit breaker

    Dungey, Mardi; Luciani, Matteo; Veredas, David (Elsevier, 2018)
    We measure systemic risk via the interconnections between the risks facing both financial and real economy firms. SIFIs are ranked by building on the Google PageRank algorithm for finding closest connections. For a panel of over 500 US firms over 2003–2011 we find evidence that intervention programs (such as TARP) act as circuit breakers in crisis propagation. The curve formed by the plot of firm average systemic risk against its variability clearly separates financial firms into three groups: (i) the consistently systemically risky (ii) those displaying the potential to become risky and (iii) those of little concern for macro-prudential regulators.
  • Who drives the change? Revisiting the CEO's strategic commitment.

    Behr, Henning; Fehre, Kerstin (2014)
    The Upper Echelons Theory has been proved to play an important role in strategic management research. Former studies have shown significant effects of CEO-specific demographic data on a firm's strategic outcome. For a further validation of those results, we reevaluate the existing results based on the concept of the commitment to the status quo (CSQ) on a German sample. Furthermore, we extend past research and investigate the impact of selected characteristics of CEO turnovers on CEOs' strategic commitment. We find evidence that supports existing findings about antecedents of CSQ, i.e. CEO tenure and past performance are good determinants for CEO's CSQ. Contrariwise, the influence of other factors like firm size or slack resources has to be reconsidered in international context. Our results further suggest that especially newly appointed CEOs after a forced turnover have the lowest commitment to current strategies and therefore the largest potential to overcome organizational inertia.
  • Hampering the change: Consequences of the CEO's strategic commitment under managerial discretion.

    Behr, Henning; Fehre, Kerstin (2015)
    CEOs play a central role for the strategic outcomes of their firms. Although research has provided many insights about the factors determining CEOs' openness toward strategic changes, the consequences of these attitudes have not been sufficiently investigated. To assess the consequences of willingness for change at the CEO level, we used the concepts of Commitment to the Status Quo (CSQ) (i.e., the belief in the enduring correctness of current strategies) and evaluate its effects for strategic persistence under the moderating role of managerial discretion. Our sample is based on 178 publicly traded firms in Germany over 10 years. Our results show that CSQ at the CEO level is crucial for strategic development only in situations of sufficiently high managerial discretion. Namely, a significant impact of the CEO's mental attitude is observable only in scenarios with high product differentiability, high market growth, bad past performance, or small companies.
  • Forward-looking reporting caught between company performance and the economic situation.

    Fehre, Kerstin; Hoefer, Julia (2015)
    This research explores both the impact of company performance and economic situation on the degree of future orientation in company reporting and the textual emphasis within forward-looking statements (company-external vs. company-internal prospective information). The examination is built on annual reports of all German HDAX companies during the period from 2003 to 2012. The results of the regression analysis reveal that high profitability and an improvement in the economy lead to an increased future orientation in company reporting. Hence, companies in an advantageous position send signals of long-lasting positive developments to capital markets. Results concerning the textual emphasis of the companies' forward-looking reporting demonstrate that the degree of forward-looking external statements increases due to company's profitability and to a downturn in the economy. In contrast, the degree of forward-looking internal statements increases due to an improvement in the economic situation. Furthermore, the economic situation positively directs the relation between performance and prospective internal reporting. Thus, forward-looking reporting focuses on the company's environment more strongly only if the economic situation is in decline (problem-oriented attention control) or if the current advantageous position of the company is preserved by the consideration of potential opportunities and risks arising from the company's environment.
  • Der Realoptionsansatz als Controllinginstrument in jungen Wachstumsunternehmen

    Fehre, Kerstin (Springer, 2007)
    Auf der Basis des Rationalitätssicherungsansatzes untersucht Kerstin H. Faaß die controllingrelevanten Merkmale von JWU sowie die Anforderungen an ein Controllinginstrument in JWU und nimmt anschließend eine umfassende Kosten- und Nutzenanalyse des Realoptionsansatzes vor. Sie leitet einen Handlungsleitfaden für die stufenweise Anwendung des Ansatzes ab und zeigt Möglichkeiten zur Nutzung des Wertbeitrages des Realoptionsansatzes als Controllinginstrument in JWU auf.
  • Back to the future: Analyzing the consequences of future orientation on strategic flexibility.

    Fehre, Kerstin; Widmann, Bettina (2016)
    Referring to the attention-based view of the firm, our study addresses the relationship between executives' future orientation and strategic flexibility. We examine the impact of the future orientation of top-level managers on two distinct facets of strategic flexibility, specifically strategic flexibility as an ex ante potential and an ex post observable status. Based on panel data for large German companies from 2003 to 2011, we find empirical evidence that a higher level of future orientation leads to higher levels of both types of strategic flexibility. Especially, the influence on the ex post observable type in terms of realized strategic flexibility is highly significant. Thus, we provide additional empirical evidence for three under-researched domains: the consequences of future orientation, the antecedents of strategic flexibility, and the precise distinction of strategic flexibility.
  • The effectiveness of combinations of CSR talk and action as strategies for (re)gaining legitimacy

    Fehre, Kerstin; Weber, Florian (2016)
    A number of scandals have challenged the social legitimacy of companies. Since corporate social responsibility (CSR) is about the pursuit of public and stakeholder objectives beyond the bottom line, a company's level of commitment to such altruistic aims is reflected in its CSR investments. It follows, then, that companies can use CSR as a vehicle for improving their legitimacy in the eyes of stakeholders and of society in general. Little research exists on the effectiveness of CSR strategies for improving legitimacy. The present study addresses this lacuna by examining how CSR communication and activity impact legitimacy. My results indicate that neither CSR communication nor CSR activity have a stand-alone effect on legitimacy. Nonetheless, CSR is important with respect to legitimacy. CSR strategies consisting of different combinations of talk and action are ranked in order of their legitimacy impact, and then this hypothetical ranking is empirically tested against a sample of German companies. Some hypotheses are confirmed while others are rejected. CSR strategies combining low levels of communication with high levels of CSR action emerge as the most effective for (re)gaining legitimacy, while those combining high levels of communication with low levels of action emerge as the worst in this regard.
  • Equity crowdfunding, shareholder structures, and firm performance

    Walthoff-Borm, Xavier; Vanacker, Tom; Collewaert, Veroniek (Wiley, 2018)
    Research question/issue: This paper provides a first‐time glimpse into the postcampaign financial and innovative performance of equity‐crowdfunded (ECF) and matched nonequity‐crowdfunded (NECF) firms. We further investigate how direct and nominee shareholder structures in ECF firms are associated with firm performance. Research findings/insights: We find that ECF firms have 8.5 times higher failure rates than matched NECF firms. However, 3.4 times more ECF firms have patent applications than matched NECF firms. Within the group of ECF firms, we find that ECF firms financed through a nominee structure make smaller losses, whereas ECF firms financed through a direct shareholder structure have more new patent applications, including foreign patent applications. Theoretical/academic implications: Our findings suggest that there are important adverse selection issues on equity crowdfunding platforms, although these platforms also serve as a catalyst for innovative activities. Moreover, our findings suggest that there is a more complex relationship between dispersed versus concentrated crowd shareholders and firm performance than currently assumed in the literature. Practitioner/policy implications: For policy makers and crowdfunding platforms, investor protection against adverse selection will be important to ensure the sustainability of equity crowdfunding markets. For entrepreneurs and crowd investors, our study highlights how equity crowdfunding and the adopted shareholder structure relate to short‐term firm performance.
  • Forecasting spare part demand with installed base information: a Review (Accepted)

    Van der Auweraert, Sarah; Boute, Robert; Syntetos, Aris (Elsevier, 2018)
    The classical spare part demand forecasting literature studies methods to forecast intermittent demand. The majority of these methods do not consider the underlying demand generating factors. Demand for spare parts originates from the part replacements of the installed base of machines, which are either done preventively or upon breakdown of the part. This information from service operations, which we refer to as installed base information, can be used to forecast future spare part demand. In this paper we review the literature on the use of such installed base information for spare part demand forecasting to asses (1) what type of installed base information can be useful; (2) how this information can be used to derive forecasts; (3) what is the value of using installed base information to improve forecasting; and (4) what are the limits of the currently existing methods. The latter serve as motivation for future research.
  • Risk governance of financial institutions: The effect of ownership structure and board independence (Published Online)

    Dupire, Marion; Slagmulder, Regine (Elsevier, 2018)
    This paper investigates how the risk governance practices of European financial institutions quantitatively cluster on the corporate governance characteristics of the corporation, particularly ownership structure and board independence. Using hand-collected data on a sample of 54 banks and 33 insurance companies, we find that financial institutions with powerful owners (i.e., those with >20% ownership) have a lower chief risk officer (CRO) presence and lower risk committee presence. In addition, state-controlled institutions and institutions with more independent boards have more independent risk committees.
  • Controlling für innovative junge Unternehmen

    Brettel, Malte; Fehre, Kerstin; Heinemann, Florian (Springer, 2007)
    Der vorliegende Artikel liegt im Forschungsdefizit des „Entrepreneurial Controllings“, d. h. dem Controlling in innovativen jungen Unternehmen begründet. Dieses Forschungsdefizit manifestiert sich neben einer bisher geringen Anzahl an Forschungsarbeiten vornehmlich in offenen forschungstheoretischen Fragen. Unbeantwortet blieben bisher insbesondere die zwei elementaren Fragestellungen nach den controllingrelevanten Merkmalen und infolgedessen nach den Anforderungen an ein Controlling in innovativen jungen Unternehmen. Diesem Forschungsdefizit steht ein hoher Praxisbedarf gegenüber: ein fehlendes Controlling in innovativen jungen Unternehmen zählt zu den Hauptursachen ihres Scheiterns. Unter Anwendung des Rationalitätssicherungsansatzes leistet der vorliegende Artikel einen wesentlichen Beitrag zur Beantwortung dieser Fragestellungen und zur Schließung der Forschungslücke im „Entrepreneurial Controlling“. Hierzu werden zunächst die Besonderheiten innovativer junger Unternehmen...
  • The Disappearing ‘Deutschland AG’ – An analysis of blockholdings in German large caps

    Fehre, Kerstin; Rapp, Marc-Steffen; Schwetzler, Bernhard; Sperrling, Marco (LLC “Consulting Publishing Company “Business Perspectives”, 2011)
    The German corporate governance system changed substantially over the last ten years. Meanwhile, ownership structures of German firms changed significantly. The paper examines the phenomenon of changing ownership structures by studying blockholdings of German large caps between 1997 and 2006. It examines the dynamics of blockholdings by analyzing the evolution of free float and block trades, where at least 5% of voting rights change hands. Two findings emerge. First, the authors find that free float increases from 65% in 1997 to 75% in 2006, mainly caused by German financials and German government entities. Simultaneously, they observe a surprisingly high number of block trades: on average 1.6 block trades per firm from 1997 to 2006. Second, the authors find that particularly individuals and German industrials are guarantors for a stable ownership structure. German financials or German government entities as blockowners increase the free float and the likelihood of block trades. Moreover, block trades are more likely to occur in firms having foreign investors as owners. The findings are of interest with respect to the evolution of the so-called ‘Deutschland AG’ but also with respect to the current anchor shareholder discussion.
  • Förderung von Frauen in Führungspositionen: Bezugsrahmen und empirische Analyse der unternehmerischen Maßnahmen

    Fehre, Kerstin; Lindstädt, Hagen; Picard, Alexander (Springer, 2014)
    Der Beitrag untersucht den Umsetzungsgrad von Maβnahmen zur Förderung von Frauen in Führungspositionen. Mittels einer Umfrage unter den CDA X-Unternehmen sowie kleinen und mittleren Unternehmen (KMU) wird eine Bestandsaufnahme angewendeter Maβnahmen erarbeitet und weiterer Handlungsbedarf identifiziert. Dies stellt die bisher gröβte empirische Untersuchung dieser Art in Deutschland dar. Der Beitrag zeigt, dass Unternehmen mit einer vergleichsweise hohen Repräsentanz von Frauen in Führungspositionen einige der Maβnahmen verstärkt umsetzen, diese jedoch über die gesamte Stichprobe eher unterdurchschnittlich häufig angewendet werden. Es hat sich auf Maβnahmenseite bisher kein Standard etabliert; ein hoher Frauenanteil in Führungspositionen scheint derzeit noch das Ergebnis unternehmensindividueller Gegebenheiten zu sein.
  • Lost in transaction? The transfer effect of strategic consistency

    Fehre, Kerstin; Kronenwett, Daniel; Lindstädt, Hagen; Wolff, Michael (Springer, 2016)
    Prior empirical studies provide evidence that the learning-curve perspective from manufacturing settings is not directly applicable to strategic management settings. In the latter case learning relates to the quality rather than to the quantity of experience. Regarding the antecedents of organizational learning especially, there are still unanswered questions remaining; for example, the questions what kind of experience has a positive effect on performance and what kind of experience is more of a hindrance than a help. This becomes obvious when looking at acquisitions as examples of strategic management decisions. Results of prior empirical studies analyzing the relationship of acquisition experience and acquisition performance have been mixed. By introducing the concept of strategic consistency, we intend to facilitate a better understanding of the kind of experience necessary for organizational learning. Therefore, we measure the concordance and frequency of change in strategic actions. Employing a sample of 379 acquisition series, we find evidence for a positive transfer effect of strategic consistency within series and, therefore, a positive relationship between strategic consistency and acquisition performance.
  • Challenging corporate commitment to CSR: Do CEOs keep talking about corporate social responsibility (CSR) issues in times of the global financial crisis?

    Fehre, Kerstin; Weber, Florian (Emerald, 2016)
    Purpose In times of crisis, the fundamental principles of companies erode, leading to strategy shifts. This paper aims to examine whether corporate social responsibility (CSR) is on management’s agenda in times of crisis, indicating CSR embeddedness into corporate strategy. The focus is on the four pillars of CSR: social, environment, economy and governance. Design/methodology/approach Starting points are competing hypotheses based on shareholder and stakeholder theory. Chief executive officer (CEO) letters to shareholders of German HDAX firms from 2003 to 2012 are analyzed by means of computer-aided text analysis. Findings The authors find that CEOs talk less about CSR in times of crisis, especially about social and governance issues, indicating that CSR is not fully embedded into corporate strategy, and that, in times of crisis, other aspects gain more importance on management’s agenda.
  • Same same, but different: Eine Analyse des Humankapitals weiblicher und männlicher Aufsichtsräte in Deutschland

    Fehre, Kerstin; Spiegelhalder, Rebecca (Springer, 2017)
    Der Beitrag untersucht die Frage, ob sich Frauen und Männer im Aufsichtsrat in ihrem Humankapital unterscheiden und somit durch Geschlechterdiversität die Voraussetzung für Wissens- und Fähigkeitenvielfalt gegeben ist. Hierzu wurden die Lebensläufe von 264 Frauen und Männern in Aufsichtsräten der HDAX- und SDAX-Unternehmen analysiert. Die Ergebnisse zeigen, dass Frauen und Männer im Aufsichtsrat Unterschiede in Bezug auf ihre Studienabschlüsse, ihre Berufserfahrung, die Anzahl weiterer Aufsichtsratsmandate, die Art der Berufung, ihre Auslandserfahrung und die Anzahl ihrer Kinder aufweisen. Keine Unterschiede konnten hinsichtlich der Zugehörigkeit zur Eigentümerfamilie nachgewiesen werden. Daraus lässt sich schlussfolgern, dass Frauen im Aufsichtsrat das Ressourcenbündel an Fähigkeiten und Wissen erweitern. Mit diesem Ergebnis leistet die Studie einen wichtigen Beitrag zur Corporate Governance Forschung. Ferner leistet die Studie einen Beitrag zur Humankapitaltheorie, indem bislang vernachlässigte Humankapitalkriterien untersucht werden und schafft eine Basis für fundierte Diskussionen zum Thema Frauen in Führungspositionen.
  • The diffusion of MBA programs in Germany: An empirical analysis through a neo-institutional lens

    Fehre, Kerstin; Schulz, Ann-Christine (2018)
    In this study we investigate determinants of the adoption of US-type MBA programs among German universities. Drawing on neo-institutional theory we argue that the diffusion of MBA programs in Germany is closely connected to the relevance debate of management education and propose that growing concerns over the legitimacy of German business schools have spurred the adoption of these programs. In an empirical analysis of 83 universities in Germany, we show that the adoption of MBA programs is positively associated with the size of the institution, its status, and the relative significance of the business school within the university. These findings expand our understanding of the underlying factors that influence the adoption and spread of this important business education program among academic institutions and elucidate why MBA programs spread among Germany universities despite their different educational tradition. This paper received the best paper price in graduate management education.
  • Management control: Concepts, methods & practice

    Bruggeman, Werner; Hozée, Sophie; Slagmulder, Regine (Intersentia, 2018)
    Management Control: Concept, Methods and Practices conceptualises management control concepts, methods and practices used by C-level executives and controllers in managing financial and strategic performance. The authors show how financial and strategic performance control processes can be integrated in order to create and improve internal strategic alignment. Alongside traditional controls, such as managing cost centres, profit centres, investment centres, budgeting and variance reporting, the use of advanced costing systems, such as activity-based costing and time-driven activity-based costing, and the balanced scorecard in planning and executing improvements of financial and strategic performance is discussed. The authors illustrate how controllers can run a control process in which intended strategies, performance measures, performance targets, actions and budgets are all aligned with each other across all organisational levels (vertical alignment) and between business units and functions (horizontal alignment), and in which financial performance is controlled in relation to strategic performance. The authors promote a holistic approach and highlight the role of human motivation in the design of management control systems. Using insights from the psychology literature on motivation in the workplace, this book argues that management control systems should not only align goals and interests of internal organisational actors but also enhance their autonomous motivation and well-being in order to achieve sustainable performance. More specifically, the authors draw on self-determination theory to explain managerial behaviour in response to the use of control systems. Through the use of numerous examples from European companies, this book provides the reader with a range of familiar issues and a wide variety of ideas and methods to use in response. The book provides materials that can be used in business and management control courses at undergraduate and graduate level, as well as for use in the workplace, benefiting managers, consultants, financial analysts, controllers, information systems designers and executive leaders of organizations.
  • DSO-TSO cooperation issues and solutions for distribution grid congestion management

    Hadush, Samson; Meeus, Leonardo (Elsevier, 2018)
    The role of DSOs is evolving due to the increasing penetration of intermittent and distributed energy resources in the distribution system. On the one hand, TSOs are accessing flexibility resources connected to the distribution grid. On the other hand, DSOs are actively managing distribution grid congestion, moving away from the conventional fit and forget approach. As a result, the need for DSO-TSO cooperation has become increasingly important. In this study, we first discuss market and grid operation issues related to different system states and the corresponding congestion management approaches, in the context of the European electricity market design and regulation. Second, we discuss viable solutions that are inspired by inter-TSO cooperation solutions as well as solutions that are being adopted by DSOs. Our findings show that the issues are rather similar both at transmission and distribution level; however, the need for cooperation and the solutions will depend on where structural congestion will occur and which borders will be managed. We also note that cooperation between DSOs as well as between DSOs and microgrids could become more important with the development of local energy markets in the long term.
  • CEO succession and the CEO's commitment to the status quo (Published Online)

    Behr, Henning; Fehre, Kerstin (Springer, 2018)
    Chief executive officer (CEO) commitment to the status quo (CSQ) is expected to play an important role in any firm’s strategic adaptation. CSQ is used often as an explanation for strategic change occurring after CEO succession: new CEOs are expected to reveal a lower CSQ than established CEOs. Although widely accepted in the literature, this relationship remains imputed but unobserved. We address this research gap and analyze whether new CEOs reveal lower CSQ than established CEOs. By analyzing the letters to the shareholders of German HDAX firms, we find empirical support for our hypothesis of a lower CSQ of newly appointed CEOs compared to established CEOs. However, our detailed analyses provide a differentiated picture. We find support for a lower CSQ of successors after a forced CEO turnover compared to successors after a voluntary turnover, which indicates an influence of the mandate for change on the CEO’s CSQ. However, against the widespread assumption, we do not find support for a lower CSQ of outside successors compared to inside successors, which calls for deeper analyses of the insiderness of new CEOs. Further, our supplementary analyses propose a revised tenure effect: the widely assumed relationship of an increase in CSQ when CEO tenure increases might be driven mainly by the event of CEO succession and may not universally and continuously increase over time, pointing to a “window of opportunity” to initiate strategic change shortly after the succession event. By analyzing the relationship between CEO succession and CEO CSQ, our results contribute to the CSQ literature and provide fruitful impulses for the CEO succession literature.

View more