Rotterdam School of Management, Erasmus U., Netherlands
Drawing on stakeholder salience theory, this study explores how Chief Human Resource Officers (CHROs) prioritize shareholder versus employee interests under varying internal and external pressures. We hypothesize that internal pressures, such as the likelihood of bankruptcy, push CHROs to prioritize shareholder concerns, often at the expense of employee interests. Conversely, external pressures, like market uncertainty and industry struggles, lead CHROs to focus on employee well-being to maintain morale and organizational stability. Using a panel dataset of S&P 1500 firms, we find support for these arguments. Our findings contribute to the sparse understanding of CHROs’ strategic role within organizations.
