Paper Title
The Effects Of Corporate Culture On Firm Value And Incremental Effects Depending On Life Cycle Stages
Abstract
Prior researches have provided evidences about relationship between corporate culture and firm performance, but there is lack of empirical research about the long-term performance and they implicitly assume that the effect of corporate culture is constant. Thus, we examine: (1) the types of culture affect the long-term firm performance positively or negatively or no effect? (2) Does changes in the firm conditions effect the corporate culture on firm value? Results reveal that “Adhocracy” culture has positive effect on the firm value; “Market” and “Clan” culture results are positive but insignificant. In contrast, “Hierarchy” culture has negative effect on firm value. Further, in growth stage, which subrogate dynamic environmental changes, adhocracy and clan culture has incremental positive effect, whereas other stages and cultures are not. It implies that the effect of corporate culture is not always consistent with the circumstances that the firm is facing.
Index Terms - Corporate culture, Firm value, Life cycle, Adhocracy culture, Clan culture, Market culture, Hierarchy culture