Blue goes green: The impact of the chief executive officer and board of directors' political ideology on corporate environmental performance

Abstract

AbstractThis study investigates the association between a CEO's political ideology and Corporate Environmental Performance. Although previous research has established a strong association between a CEO's political ideology and overall performance on Corporate Social Responsibility, little research has examined how it relates to a firm's environmental impact. Utilizing data on CEO political donations, this study shows that a CEO's liberalism generally has a positive effect on a firm's environmental performance. However, this relationship can be influenced by the political conservatism of the board of directors. Furthermore, liberal CEOs are inclined to prioritize environmental strength and minimize environmental concerns. This research provides insight into the intricate dynamics of how a CEO's political ideology, as well as that of the board of directors, can influence a firm's environmental performance.