Motivated toward digital: relationship of CEO regulatory focus and digital orientation

Purpose This study examines how CEO regulatory focus relates to a firm's digital orientation, recognizing that pursuing digital opportunities is crucial for competitive advantage. We propose that CEO promotion focus is positively related to digital orientation, while prevention focus is negatively related, and explore how alignment between regulatory focus and the firm's environment (regulatory fit) moderates this relationship. Design/methodology/approach We analyzed S&P 500 firms from 2010 through 2019 using data from Compustat, Execucomp and annual shareholder letters, measured key variables with computer-assisted text analysis and tested hypotheses using generalized estimating equations. Findings The findings show that CEO prevention focus is positively associated with digital orientation, and that the strength of this relationship depends on environmental dynamism and complexity, while promotion focus was found not to be associated with digital orientation nor vary with the environment. Originality/value We extend research on managerial characteristics and digital orientation by examining how CEO goal pursuit motivation, specifically growth (promotion focus) versus security (prevention focus) needs, relates to firm's orientation toward digital opportunities.