The global impact of the Covid-19 pandemic has increased the importance for organizations to understand and foster resilience. In this study, we explore how an organization's liberalism influences its organizational resilience. Specifically, we argue that liberal-leaning firms achieve greater resilience in two ways–namely, higher stability and faster recovery. Furthermore, we delve into the mediating role of exploration as a proxy for a firm’s adaptive and absorptive capabilities. Using a sample of S&P 500 listed firms, our empirical findings indicate that liberal-leaning organizations experienced a smaller setback during the initial Covid-19 shock and achieved quicker recovery to pre-shock levels. Furthermore, we find that exploration mediates the relationship between organizational liberalism and performance setback, such that liberal-leaning organizations achieve a higher level of exploration, which in turn, mitigates the performance setback during adversity.
