Blue versus red: partisan firm leaders and corporate culture

Abstract

This paper documents significant partisan divides across a range of corporate cultural values. Using panel data of 2,424 S&P 1500 firms spanning the period from 2001 to 2018, we find that firms whose top management teams lean toward the Democratic Party exhibit higher cultural values of integrity, teamwork, innovation, respect, and quality, in comparison with firms with executives leaning toward the Republican Party. In addition, we find that the partisan gap diminishes when firms have less entrenched management or locate in states with stronger judicial accountability. Our findings lend support to earlier research suggesting that leader characteristics are associated with corporate culture.