Driving a More Prosperous Future

Building credible commitments via board ties: Evidence from the supply chain
November 2025

Using a novel dataset that provides a comprehensive coverage of U.S. firms' industrial supply chain relationships, we find that firms with innovation specific to a buyer are more likely to share a common director with that buyer. This association is stronger when the buyer has a larger number of alternative suppliers. We further find that when a supplier–buyer pair shares a common director, the supplier's R&D investment is more sensitive to the investment opportunities of its buyer. Moreover, such pairs tend to have longer supply chain relationships. Taken together, our findings demonstrate that board ties serve as a credible commitment mechanism to support exchange along the supply chain and safeguard suppliers' buyer-specific investments.

Rebecca Hann, University of Maryland-College Park; Musa Subasi, University of Maryland-College Park; Yue Zheng, Hong Kong University of Science and Technology

• Corporate Strategy
• Innovation
• Leadership

Status-Amplified Deterrence: Paul Manafort’s Prosecution Under the Foreign Agents Registration Act
Organization Science, September 2025

Social control agents often struggle to deter organizational deviance. We propose a theory of “status-amplified deterrence” wherein enforcement’s deterrent effects are amplified when carried out against high-status organizational actors. First, this enforcement is interpreted as willingness and ability for far-reaching enforcement. Next, amplified deterrence occurs as these episodes become widely known through (1) extensive media coverage and (2) the marketing efforts of third-party compliance advisors. We examine this theory in the context of the U.S. Department of Justice’s enforcement against Paul Manafort for violating the Foreign Agents Registration Act (FARA). Using a difference-in-differences design, we demonstrate that enforcement against Manafort caused a widespread, sustained, and economically significant reduction in FARA noncompliance. We show supplementary evidence consistent with the idea that deterrence was amplified in significant part by media attention and by law firms referencing the episode while successfully marketing FARA advisory services. We contribute to literature illuminating how organizations, in conjunction with third-party compliance advisors, adjust deviant activities in response to shifting regulatory environments.

Reuben Hurst, Jin Hyung Kim (George Washington University) and Jordan Siegel (University of Michigan)

• Corporate Strategy
• Leadership
• Organizational Culture and Change
• Risk Management

Biodiversity Entrepreneurship
Review of Finance

We study an emerging class of start-up organizations focused on biodiversity conservation and the challenges they face in financing these ventures. Using a novel machine learning method, we identify 630 biodiversity-linked start-ups in PitchBook and compare their financing dynamics to other ventures. Biodiversity start-ups raise less capital but attract a broader coalition of investors, including not only venture capitalists (“value investors”) but also mission-aligned impact funds and public institutions (“values investors”). Values investors provide incremental capital rather than substituting value investors, but funding gaps persist. We show biodiversity-linked start-ups use social media activity to help connect with value investors. Our findings can inform policy and practice for mobilizing private capital toward biodiversity preservation, emphasizing hybrid financing models and strategic communication.

Sean Cao, Robert H. Smith School of Business, University of Maryland

• AI
• Corporate Strategy
• Enterprise and Markets
• Entrepreneurship
• ESG
• Innovation
• Risk Management
• Social Entrepreneurship and Non-Profits
• Social Media
• Sustainable Consumption