Academia to Action: Managerial Academic Experience and Corporate ESG Performance

51 Pages Posted: 8 Dec 2023

See all articles by George J. Jiang

George J. Jiang

Washington State University

Wenquan Li

Xi'an Jiaotong-Liverpool University (XJTLU) - International Business School Suzhou; University of Queensland - Business School

Nan Shi

China Galaxy Securities

Zizhe Tang

Southern University of Science and Technology

He Wang

Southern University of Science and Technology

Date Written: December 4, 2023

Abstract

This paper examines the impact of managerial academic experience on corporate environmental, social, and governance (ESG) performance. We find that firms with more academic executives in the top management team exhibit significantly higher ESG performance. In addition, our results suggest that the effect is stronger for firms with young academic executives. To address potential endogeneity concerns, we employ instrumental variables and propensity score matching approaches and confirm our main findings. Moreover, we show that high ESG performance of firms with academic executives is consistent with shareholder value and unlikely driven by agency issue. To corroborate our main findings using observable ESG actions, we show that firms with academic executives have lower pollution intensity and engage more in philanthropy. Finally, we show evidence that academic executives improve firm ESG performance through increases in capital expenditure rather than financial leverage.

Keywords: Managerial academic experience; ESG performance; Agency issue; Pollution intensity; Corporate philanthropy; Capital expenditure

JEL Classification: G30, G40, J24, M14

Suggested Citation

Jiang, George and Li, Wenquan and Shi, Nan and Tang, Zizhe and Wang, He, Academia to Action: Managerial Academic Experience and Corporate ESG Performance (December 4, 2023). Available at SSRN: https://ssrn.com/abstract=4652447 or http://dx.doi.org/10.2139/ssrn.4652447

George Jiang

Washington State University ( email )

Department of Finance and Management Science
Carson College of Business
Pullman, WA 99-4746164
United States
509-3354474 (Phone)

HOME PAGE: http://directory.business.wsu.edu/bio.html?username=george.jiang

Wenquan Li (Contact Author)

Xi'an Jiaotong-Liverpool University (XJTLU) - International Business School Suzhou ( email )

111 Ren'ai Road
Suzhou Industrial Park
Suzhou, Jiangsu 215123
China

HOME PAGE: http://scholar.xjtlu.edu.cn/en/persons/WenquanLi

University of Queensland - Business School ( email )

Brisbane, Queensland 4072
Australia

Nan Shi

China Galaxy Securities ( email )

235 Tianhe North Road
Guangzhou, Guangdong
China

Zizhe Tang

Southern University of Science and Technology ( email )

No 1088, xueyuan Rd.
Xili, Nanshan District
Shenzhen, Guangdong 518055
China
+86-13841620994 (Phone)

He Wang

Southern University of Science and Technology ( email )

1088 Xueyuan Avenue
Shenzhen, Guangdong 518055
China

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