Stakeholder Sentiment, Problemistic Search, and Firm Risk Taking: A Behavioral Investigation

Drawing on problemistic search arguments, we suggest that stakeholder sentiments affect firms' search and risk taking. Specifically, similar to the logic underlying performance feedback, we suggest that a shortfall in stakeholder sentiments from historically and socially derived aspirations, affects firms' decision making. In comparison to financial performance indicators, we suggest that stakeholder sentiments describe a more comprehensive picture about the multi-dimensionality of managers' goal perspective and, hence, adds value to our current understanding of problem driven search.