We propose strategic ingratiation as a means for firms to manage negative spillovers arising from associated politicians being investigated for corruption. Strategic ingratiation is a corporate political strategy through which firms increase their contributions to political powerholders’ policy priorities to gain goodwill and favorable treatment. We find that following investigation of associated politicians for corruption in China, firms increased their R&D investments as a means of strategic ingratiation, particularly when political powerholders prioritized R&D. Firms that increased R&D received more favorable coverage by state-controlled media but did not garner more favorable responses from investors. We contribute by theorizing strategic ingratiation as a viable channel for managing political spillovers, and by demonstrating that a multi-stakeholder perspective clarifies the varying effectiveness of strategic ingratiation.
