In this dissertation I have three essays. In Essay 1 I focus on two main groups of stakeholders, the investor community and the customers of a firm. I view their interaction through the lens of a third group of stakeholders, managers. Managers, like other humans, have a limited amount of attention that can be applied to firm projects. When attention is spread thin for firms operating in many business segments then managers are unable to adequately address the needs of the investor community and customer stakeholder groups. A tradeoff between these two groups is necessary in this situation. However, when a firm is narrowly focused, doing business in only a few segments, then there is enough managerial attention and the firm should follow a dual emphasis. A firm that has achieved a dual emphasis in this scenario should be able to achieve higher long-term financial results compared to only pursuing customer or investor related projects.Essay 2 continues with the theme of researching multiple stakeholder groups. This essay investigates the interactions of society, the investor community, and the employees of a firm. A firm can address the needs of these groups through corporate social responsibility (CSR) acts, but how does CSR benefit or disadvantage investors? This essay uses signaling theory (Kirmani and Rao 2000) in four common situations to discern the extent that firms are advantaged or disadvantaged by CSR strengths and concerns. CSR signals are divided into external (e.g., environmental issues such as pollution) and internal (e.g., employee issues such as hiring practices) as well as strengths (exceeding legal standards) and concerns (running afoul of the law). These four types of CSR signals, in addition to information from annual reports, customer satisfaction, short-term financial measures, and industry concentration, only sometimes combine to provide strong signals to investors regarding a firms future prospects. Results from this essay show that the best results, from the investment community point of view, can be summarized in three points. First, externally focused CSR activities are assisted by managerial advertising to investors, do not compensate for low short-term financial outcomes, assist firms in concentrated industries, but are detrimental for firms in less concentrated industries. Second, internally focused CSR activities are worse for firms with high (vs. low) levels of customer satisfaction, low (vs. high) levels of industry concentration, and low (vs. high) levels of short-term financial outcomes. Third, internal CSR issues have little importance from an investor point of view.The third essay in my dissertation, once again centers on customers, but also investigates the role that managers and employees have on value creation for a firm. In order to investigate the interactions of these groups, two data sets were used. One was from the German retailing industry and the other from a US banking firm. This allows the results to be generalized to more industries and countries. Results show that 1) The effect of managerial (franchisee) satisfaction on customer satisfaction is fully mediated via employee satisfaction; 2) The effect of customer satisfaction on repurchase intention is strongly moderated by front-line employee satisfaction; and 3) Customer repurchase intentions affect firm revenues. These results suggest that firms seeking to enhance customer satisfaction, repurchase intentions, and profits should not only make direct investments in customer satisfaction, but also indirect investments in human resources, especially in improving satisfaction among front-line employees.
