Long‐term orientation and hedge fund activism

We examine whether activist hedge fund managers' culturally originated temporal orientation influences activism processes and outcomes. Long‐term‐oriented activists hold investments longer and generate greater improvements in target firms' operating performance, consistent with a focus on long‐term value creation. They are more likely to pursue objectives that support sustainable growth, such as changes in business strategy and corporate governance. These activists also achieve higher engagement success rates, likely because their interests align with a broader set of stakeholders and they are better at building relationships. Finally, the stock market reacts more positively to engagements initiated by long‐term‐oriented activists.