The Effect of Chief Executive Officer and Board Prior Corporate Social Responsibility Experiences on Their Focal Firm’s Corporate Social Responsibility: The Moderating Effect of Chief Executive Officer Overconfidence

Abstract

This research aims to examine how the prior experiences of the chief executive officer (CEO) and board influence the focal firm’s Corporate Social Responsibility (CSR) activities. Further, the present study examines how CEO overconfidence influences the diffusion of CSR activities. The authors theorize that overconfident CEOs are influenced more by the corporate strategies they experienced on other boards and less by the corporate strategies experienced by other directors. Through longitudinal analyses of the CSR profiles a sample of S&P 500 companies for the period 2006-2013, the study shows that CEO and board prior CSR experience are positively related to the firm’s current CSR activities. The authors find a significant positive moderating effect of CEO overconfidence on the relationship between CEO prior CSR and the focal firm’s CSR. The theory and results highlight how CEO and board prior CSR exposure may influence the focal firm’s stances toward CSR and that CEO overconfidence may have differential effects on these relationships.

Firm Performance and Corporate Social Responsibility: Spatial Context and Effect Mechanism

“…According to stakeholder theory, institutional investors and stockholding executives are the main stakeholders that influence corporate CSR (Fwa et al, 2020; Hong et al, 2016; Nofsinger et al, 2019). However, in past analyses of CSR stakeholders, institutional investors and stockholding executives were generally used only as antecedents of CSR (Al-Shammari et al, 2022; X. Chen et al, 2021; Hartzell & Starks, 2003).…”

“…Stockholding executives actively respond to stakeholders’ expectations, make charitable donations, and conduct other CSR activities (Al-Shammari et al, 2022; Waldman & Siegel, 2008). In Indonesia, executive shareholding affects CSR activities positively (Jia & Zhang, 2013).…”

Research on Corporate Social Responsibility: Insights and Future Directions

“…CEO compensation can affect the focus and allocation of resources towards CSR efforts (Fabrizi et al 2014;Li et al 2016). The focus on CSR may also be impacted by the power of stakeholders, especially the board of directors (M. Al-Shammari et al 2022a). The success of tying CEO compensation to CSR initiatives, however, may depend on regional and cultural variances.…”

Sentimentally attached to hometown: CEO hometown identity and corporate environmental violations

“…The CEO decides whether and how the enterprise performs its social responsibilities. In previous research, the demographic characteristics of CEOs, such as their gender (McGuinness et al, 2017), marital status (Hegde & Mishra, 2019), and degree (Sun et al, 2021), as well as professional background (Garcia-Sanchez and Martinez-Ferrero, 2019), experience (Al-Shammari et al, 2022), tenure (Chen et al, 2019;Jeong et al, 2021) and multiple positions (Bose et al, 2022), have been extensively and deeply studied. In addition, the deeper characteristics of CEOs, such as their arrogance (Tang et al, 2018), narcissism (Al-Shammari et al, 2019), emotion (Wang et al, 2022), values (Prompeler et.…”