Does CEO’s initial tenure enhance CSR practices? Evaluating the consequences of CEO’s initial tenure CSR engagement in China

Jin Yan (), Talat Mehmood Khan (), Naiping Zhu (), Muhammad Awais Khan () and Hazrat Hassan ()
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Jin Yan: Hohai University
Talat Mehmood Khan: Jiangsu University
Naiping Zhu: Jiangsu University
Muhammad Awais Khan: Southwestern University of Finance and Economics
Hazrat Hassan: Jiangsu University

Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, 2024, vol. 26, issue 9, No 36, 22839-22862

Abstract: Abstract The present study investigates whether CEO initial tenure is essential in establishing CSR practices. In further analysis, we contemplate the consequences of CEO’s initial service tenure CSR engagement. Our analysis is based on the sample of Chinese-listed firms from 2009 to 2019 periods—the research study used a fixed-effect panel approach for analyzing the dataset. A two-stage-least square test is then used to address the endogeneity problem. The study's findings manifest that CEO tenure is negatively and significantly associated with CSR practices. In an additional analysis, the study reveals that CEOs have more significant career concerns in the initial service period than afterward in their later service period. Therefore, CSR practices increase in CEO's initial service tenure. Moreover, the study documented that the CEO’s CSR engagement in their initial tenure has a positive-and-significant association with their compensation package and lessens the risk of dismissals. Finally, we demonstrate that CEOs concentrate more on CSR practices in coastal regions of China. This research is helpful for policymakers in devising CSR policies and making corporate governance decisions.

Keywords: CSR; CEO tenure; Career concerns; CEO compensation; CEO dismissals (search for similar items in EconPapers)
Date: 2024
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DOI: 10.1007/s10668-023-03578-2

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