The impact of CEO hedging on corporate ESG performance: Evidence from the United States

IF 7.4 2区经济学 Q1 BUSINESS, FINANCE Finance Research Letters Pub Date : 2024-09-04 DOI:10.1016/j.frl.2024.106067

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Abstract

Corporate ESG performance is increasingly recognized as crucial for sustainable development, yet the impact of CEO behavior on this metric remains understudied. This paper investigates how CEO hedging affects corporate ESG performance, addressing a significant gap in the literature. Using data from U.S. listed companies from 2013 to 2021, we employ regression analysis and propensity score matching to examine this relationship. Our findings reveal that CEO hedging significantly reduces corporate ESG performance. Further analysis shows that the CEO's shareholding ratio and corporate risk enhance this negative correlation, while external supervision mitigates it. Heterogeneity analysis indicates a stronger correlation in low-polluting enterprises. These results underscore the ethical implications of CEO option trading for personal risk hedging and highlight the importance of avoiding behaviors that can adversely affect a firm's ESG performance. Our study contributes to the understanding of corporate governance and sustainable development, offering valuable insights for policymakers and corporate leaders in designing effective strategies to enhance ESG performance.

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首席执行官套期保值对企业环境、社会和公司治理绩效的影响：来自美国的证据

企业的环境、社会和公司治理（ESG）绩效日益被视为可持续发展的关键，但首席执行官的行为对这一指标的影响仍未得到充分研究。本文研究了首席执行官的对冲行为如何影响企业的环境、社会和公司治理绩效，弥补了文献中的重大空白。利用 2013 年至 2021 年美国上市公司的数据，我们采用回归分析和倾向得分匹配来研究这种关系。我们的研究结果表明，首席执行官的对冲行为会显著降低企业的环境、社会和治理绩效。进一步的分析表明，首席执行官的持股比例和公司风险增强了这种负相关关系，而外部监督则减轻了这种负相关关系。异质性分析表明，低污染企业的相关性更强。这些结果凸显了首席执行官期权交易对冲个人风险的道德影响，并强调了避免可能对公司环境、社会和公司治理绩效产生不利影响的行为的重要性。我们的研究有助于加深对公司治理和可持续发展的理解，为政策制定者和企业领导者设计有效战略以提高环境、社会和公司治理绩效提供了宝贵的见解。

本文章由计算机程序翻译，如有差异，请以英文原文为准。

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来源期刊

Finance Research Letters BUSINESS, FINANCE-

CiteScore

11.10

自引率

14.40%

发文量

863

期刊介绍： Finance Research Letters welcomes submissions across all areas of finance, aiming for rapid publication of significant new findings. The journal particularly encourages papers that provide insight into the replicability of established results, examine the cross-national applicability of previous findings, challenge existing methodologies, or demonstrate methodological contingencies. Papers are invited in the following areas: Actuarial studies Alternative investments Asset Pricing Bankruptcy and liquidation Banks and other Depository Institutions Behavioral and experimental finance Bibliometric and Scientometric studies of finance Capital budgeting and corporate investment Capital markets and accounting Capital structure and payout policy Commodities Contagion, crises and interdependence Corporate governance Credit and fixed income markets and instruments Derivatives Emerging markets Energy Finance and Energy Markets Financial Econometrics Financial History Financial intermediation and money markets Financial markets and marketplaces Financial Mathematics and Econophysics Financial Regulation and Law Forecasting Frontier market studies International Finance Market efficiency, event studies Mergers, acquisitions and the market for corporate control Micro Finance Institutions Microstructure Non-bank Financial Institutions Personal Finance Portfolio choice and investing Real estate finance and investing Risk SME, Family and Entrepreneurial Finance