After Acquiring Innovation and Sustainability: Executive Effects

Abstract

An extensive body of research supports that firms acquire other firms in order to innovate and/or become more sustainable. Extant theory posits that power in top management teams is among many determinants of success of acquisitions. This study focuses on and empirically investigates the relationship between power in top management teams and post-acquisition performance. Our results show that expert power and prestige power in the combined top management team are positively related to post-acquisition performance in both related and unrelated acquisitions. The study concludes with implications for future research and managerial practice.