Set in Stone: The Persistence and Origin of Corporate Culture
Release time：04 June 2025
Jun
09
|
Time & Date
|
10:30 am
-
12:00 pm,
June
09,
2025
(Monday)
|
| Topic: | Set in Stone: The Persistence and Origin of Corporate Culture |
| Time&Date: | 10:30 am -12:00 pm, June 9, 2025 (Monday) |
| Venue | Room 804, Teaching Complex D Building |
| Speaker: |
Kai Li University of British Columbia |
| Abstract: | We examine the evolution and origin of corporate culture, distinguishing between the values and norms that prevail within a company and the individual preferences of corporate insiders. Using one of the largest panel datasets on corporate culture, we first show that culture is remarkably stable: firms with strong (or weak) cultures tend to remain so over the following decade. We then find that most of the variation in corporate culture is explained by time-invariant firm fixed effects, largely attributed to a firm’s cultural traits established around the time of its initial public offering. Using a rich set of founder characteristics, we show that a firm’s early culture is significantly influenced by its founder’s cultural heritage, the racial diversity at her birthplace, and the business environment at the start of her career. Finally, we provide some suggestive evidence that CEO–firm matching on values, along with the treatment of culture on top employees, are potential mechanisms underlying the persistence in corporate culture. We conclude that a firm’s early culture—shaped by its founders—together through values-based selection and treatment explain the enduring nature of corporate culture. |
| Biography: | Kai Li holds the W. Maurice Young Endowed Chair in Finance at the UBC Sauder School of Business, University of British Columbia. She is Managing Editor of Journal of Financial and Quantitative Analysis. Prof. Li’s research focuses on the economic consequences of corporate governance mechanisms. Her current research projects explore: (1) gender and finance, (2) corporate culture, and (3) green innovation. Her research has appeared in Journal of Finance, Journal of Financial Economics, Review of Financial Studies, Journal of Financial and Quantitative Analysis, Management Science, Journal of International Business Studies, and many other leading journals in Finance and Economics. |
