A Penny Saved Is a Penny Earned: How Executive Cognitive Flexibility Drives Performance Through Strategic Resource Reallocation

Xiaochuan Guo, La Tao (), You Chen and Xue Lei
Additional contact information
Xiaochuan Guo: School of Management, Shanghai University, Shanghai 200444, China
La Tao: School of Management, Shanghai University, Shanghai 200444, China
You Chen: School of Management, Shanghai University, Shanghai 200444, China
Xue Lei: School of Management, Shanghai University, Shanghai 200444, China

Sustainability, 2025, vol. 17, issue 15, 1-27

Abstract: In an era where sustainable development is increasingly a core strategic issue for businesses, how top management, as the architects of corporate strategy, can achieve a synergy of economic, social, and environmental benefits through internal management mechanisms to promote corporate sustainability is a central focus for both academia and practice. This study aims to explore how Executive Cognitive Flexibility (CF) influences Firm Performance and to uncover the mediating effects of Non-market Strategy. We use panel data from Chinese A-share listed companies between 2016 and 2022 to examine and empirically analyze this mechanism. Our findings indicate that CF has a positive impact on Firm Performance. This relationship is realized through the pathway of Non-market Strategy, specifically manifesting as a reduction in Corporate Social Responsibility (CSR) and an increase in Corporate Political Activity (CPA). Further analysis reveals that the impact of executive cognitive flexibility on firm performance is differentially influenced by internal and external environmental contexts. The findings of this study provide important practical insights and policy recommendations for companies on cultivating executive cognitive flexibility, optimizing non-market strategies, and enhancing firm performance in various internal and external environments.

Keywords: executive cognitive flexibility; non-market strategy; corporate social responsibility; corporate political activity; firm performance (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2025
References: Add references at CitEc
Citations:

Downloads: (external link)
https://www.mdpi.com/2071-1050/17/15/6698/pdf (application/pdf)
https://www.mdpi.com/2071-1050/17/15/6698/ (text/html)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:gam:jsusta:v:17:y:2025:i:15:p:6698-:d:1707925

Access Statistics for this article

Sustainability is currently edited by Ms. Alexandra Wu

More articles in Sustainability from MDPI
Bibliographic data for series maintained by MDPI Indexing Manager ().