Firms frequently employ impression management to build and maintain their legitimacy. Prior research has revealed a breadth of impression management tactics employed by firms. Despite the wealth of literature on impression management, there has been a predominant focus on individual firms as sources of impression management, i.e., a significant gap exists in understanding how firms can build and enhance their legitimacy through firms’ interactions. This paper draws on impression management and strategic alliances literatures to investigate four impression management tactics— self-praise, appropriation, endorsement, and mutuality—that are particularly prevalent in the context of firm-firm interactions. We propose that entrepreneurial firms in firm-firm partnerships favor endorsement and mutuality to build legitimacy and incumbent firms favor self-praise and appropriation to maintain legitimacy. Furthermore, we introduce two boundary conditions related to firms’ legitimacy concerns, namely network distress, i.e., whether the focal partnership is the first for the entrepreneurial firm and innovation distress, i.e., how stressed the pipeline is by imminent expiring patent protections for the incumbent firm. Leveraging Large Language Model (LLM) and Machine Learning (ML) techniques, we analyze the impression management tactics in 8,003 executive quotes pertaining to 2,667 strategic alliances in the biopharmaceutical industry. Our empirical results support our arguments, providing compelling evidence that incumbent and entrepreneurial firms vary in their use of self-praise, appropriation, endorsement, and mutuality and that the relationships are contingent on the firms’ distresses. In conclusion, our study makes a significant contribution to the field of impression management research by elucidating how partnering firms mutually reinforce their legitimacy by referencing each other, thereby facilitating the establishment and the maintenance of their respective legitimacy.
