Enhancing corporate environmental, social and governance (ESG) performance in China: The role of returnee chairmen vs. CEOs with foreign experience

Jiazhu Li and Zishang Liu

Research in International Business and Finance, 2025, vol. 76, issue C

Abstract: This study investigates the impact of foreign experience (FE) on the environmental, social, and governance (ESG) performance of Chinese firms, with particular emphasis on the combined roles of Chairmen and CEOs. Drawing on imprinting theory, social identity theory, status characteristics theory, and the status congruence model, we explore how relational demographic differences in FE between Chairmen and CEOs influence corporate ESG outcomes. Our results indicate that FE significantly improves ESG performance, with Chairmen’s FE exerting a more substantial effect than that of CEOs. Moreover, specific combinations of international experience between Chairmen and CEOs lead to enhanced ESG performance. Chairmen with FE from common law countries drive more pronounced ESG improvements, with foreign work experience demonstrating a stronger impact than foreign academic experience. Additionally, our findings reveal that the foreign experience of the Chairman or CEO has a more pronounced effect on the environmental and social responsibility sub-indicators of ESG, while its impact on governance is comparatively weaker. This study highlights the unique dual role of Chairmen in China, who serve not only as corporate governance agents but also as active controllers involved in daily operations. The findings provide valuable insights into the influence of relational demographic dynamics among top executives on ESG performance, emphasizing that strategically pairing Chairmen and CEOs with FE can effectively foster sustainable corporate development.

Keywords: Foreign experience; ESG performance; Corporate governance; Relational demography; Top management team (search for similar items in EconPapers)
JEL-codes: G30 G34 Q54 (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eee:riibaf:v:76:y:2025:i:c:s0275531925000662

DOI: 10.1016/j.ribaf.2025.102810

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