To win the marketplace, you must first win the workplace: CEO ability, CSR, and firm performance: evidence from fast-growing firms in Asia–Pacific

Abstract

In this study, we examine the impacts of the chief executive officer’s (CEO) ability on a firm’s corporate social responsibility (CSR) and the CSR effect on a firm’s performance. In addition, we explore the CEO’s role in aligning the relationship between CSR and firm performance. Our findings show that a firm’s CSR and performance increase with the CEO’s ability. Further, CEO ability moderates an insignificant association between CSR and firm performance. Importantly, we also find that the positive relation between CEO ability and CSR is weak for CEOs with dual roles and is also ineffective when CSR emphasis exerted by the external environment is more robust. Importantly, we find that gender critical mass substitutes the relation between CEO ability and CSR, signifying that a firm with gender crucial mass on its board is likelier to adopt CSR irrespective of CEO ability. We also find that CEO career concerns moderate the relation between CEO ability and firm performance. Notably, CEO gender moderates the association between CEO ability and firm CSR and firm performance, implying that female CEOs with high ability are likelier to adopt CSR practices and align CSR performance to firm performance. Overall, our evidence is consistent with our conjectures that more able CEOs have fewer career concerns and are more willing to undertake CSR investments leading to firm performance.