Managerial discretion, firm performance, and CEOs’ support for privatisation of state-owned companies

The objective of this paper is to shed light on the antecedents of managerial support for privatisation of State-Owned Enterprises (SOEs). The results of the study, based on 134 Polish SOEs, reveal that managerial autonomy (conceptualized as the extent to which CEOs are free from stakeholder pressure) is negatively related to CEOs’ support for privatisation. Moreover, firm performance has an indirect impact on CEOs’ support for privatisation, that is, it enhances CEOs’ positive attitude towards state control, which, in turn, negatively relates to CEOs’ support for privatisation. The study brings important theoretical and practical implications, indicating that privatisation efforts may meet with strong resistance from managers who enjoy a high level of discretion in SOEs.