Toward the Hybridization of Value: Firm Value Orientations and Collective Stakeholder Outcomes

Despite burgeoning research on how firm financial performance is affected by a broader orientation toward social value, we know much less about how an orientation toward financial value or social value affects the well-being of firms’ stakeholders, both individually and collectively. In contrast to theories that juxtapose financial value and social value orientations, I argue that it is actually through their combination that collective stakeholder well-being is maximized due to recent shifts in institutional logics around firm value. Using a unique combination of datasets, including parsed word counts of both financial and social words from publicly traded firms’ annual reports, shareholder performance data from Compustat, customer satisfaction ratings from the American Customer Satisfaction Index (ACSI), employee satisfaction ratings from Glassdoor, and community impact data from KLD Social Ratings, I find that whereas increases in collective stakeholder value were previously associated with only a single orientation toward value, either social value or financial value alone, in more recent years such increases in collective stakeholder value are associated with the combination of both financial value and social value orientations, suggesting a shift toward a more hybrid conception of firm value.