In 2016 the Chinese government initiated a nationwide campaign aiming to eliminate poverty in China by 2020. Over 20% of listed firms in China have made significant contributions to the campaign. Using hand-collected data on listed firms’ contributions to the campaign and multivariate analyses, we examine whether managers’ and politicians’ personal incentives play an important role in firms’ contributions to the campaign. The results show that firms are more likely to contribute if they are state-owned and managers are appointed by (...) governments, if managers have a higher risk of being targeted in a concurrent anti-corruption campaign, if the political leaders in their province are new or intend to seek promotion, and if managers or directors have experienced poverty in their early life. The results suggest that it is important to consider managers’ and politicians’ personal incentives in CSR activities that could have a grand social impact. (shrink)

Business Ethics: A European Review, EarlyView.

Despite the rising interest in environmental strategies, few studies have examined how managerial cognition of such strategies influences actual innovation capability development. Taking a managerial cognition perspective, this study investigates how managers’ perceptions of institutional pressures relate to their focus on proactive environmental strategy, which in turn affects firms’ realized innovation capability. The findings from a primary survey and three secondary datasets of publicly listed companies in China reveal that managers’ perceived business and social pressures are positively associated with their (...) focus on proactive environmental strategy, which consequently fosters innovation capability development. Moreover, state ownership and government administrative control weaken the impact of managerial focus on proactive environmental strategy on innovation capability. These findings have important implications for how managerial cognition supports environmental strategy and organizational capability building under the influence of institutional pressures and government intervention. (shrink)

Drawing from the stimulus-organism-response model, this study examines how and under what circumstances perceived environmental corporate social responsibility affects innovative behavior of employees in the context of environmental protection. Using a sample of 398 employees from different firms in the high energy-consuming industry of China, the results indicate that, at first, perceived ECSR provides a positive effect on organizational identification. Secondly, organizational identification has a positive influence on the innovative behavior of employees. Thirdly, organizational identification plays an important mediating effect (...) between perceived ECSR and the innovative behavior of employees. Fourthly, both the effect of perceived ECSR on organizational identification and the indirect effect of perceived ECSR on the innovative behavior of the employees via organizational identification will be stronger when the levels of organizational trust are high. These findings add new insights into the perceived ECSR-employees’ innovative behavior relationship and provide important managerial implications for enhancing ECSR perception to improve the innovative behavior of employees. (shrink)

For strategists working in and for firms, acquiring knowledge about the business world is dependent on a rational process of collecting, organizing, and interpreting information. As such, these individuals are best conceived not as knowers, but as self-directing learners who are motivated to acquire, create, and apply new knowledge. To facilitate these processes, in this paper an axiomatic foundation for strategic thinking is established regarding the nature of the object of strategic thinking, the nature of strategic thinking, and the nature (...) of knowledge. Next, four boundary references set by these axioms are used to establish a new conceptual frame of reference for strategic rationality. Interconnections between the boundary references are subsequently used to infer six canons for strategic rationality. It is concluded that strategic rationality may be found where all references overlap. Finally, to contribute towards greater rationality in strategic management practice, an actionable definition of strategic rationality is formulated that includes all references and canons. (shrink)

We examine how corporate environmental responsibility affects the cost of equity capital for manufacturing firms in 30 countries. Using several approaches to estimate firms’ ex ante equity financing costs, we find in regressions that control for firm-level characteristics as well as industry, year, and country effects that the cost of equity capital is lower when firms have higher CER. This finding is robust to addressing endogeneity through instrumental variables, to using alternative specifications and proxies for the cost of equity capital, (...) and to accounting for noise in analyst forecasts. We conclude that investment in CER reduces firms’ equity financing costs worldwide. (shrink)

The disclosure of corporate environmental performance is an increasingly important element of a firm’s ethical behavior. We analyze how the legal origin of foreign institutional investors affects a firm’s voluntary greenhouse gas emissions disclosure. Using a large sample of firms from 36 countries, we show that foreign institutional ownership from civil law countries improves the scope and quality of a firm’s greenhouse gas emissions reporting. This relation is robust to addressing endogeneity and selection biases. The effect is more pronounced in (...) firms from non-climate-sensitized countries, for which the gap between firms’ environmental standards and investors’ environmental targets is potentially larger, and in less international firms. Firms with a higher level of voluntary greenhouse gas emissions disclosure also exhibit higher valuations. (shrink)