The impact of chief executive officer narcissism on environmental, social, and governance reporting

We analyze the effect of chief executive officer (CEO) narcissism on environmental, social, and governance (ESG) reporting. The study relies partly on hand‐collected, visual data and covers 57 German DAX 40 and MDAX companies from 2016 to 2020 (266 company‐year observations, Bloomberg database). Loo...

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Bibliographic Details
Published in:Business strategy and the environment 2023-11, Vol.32 (7), p.4448-4466
Main Authors: Kind, Finja Lena, Zeppenfeld, Jennifer, Lueg, Rainer
Format: Article
Language:English
Subjects:
Auditors
Chief executive officers
Companies
Corporate governance
corporate social responsibility
Environmental governance
Environmental performance
Environmental policy
Governance
Human resource managers
Narcissism
Regression analysis
Resource managers
Social responsibility
stakeholder engagement
strategic decisions
Sustainability reporting
sustainable development
upper echelons theory
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Summary:We analyze the effect of chief executive officer (CEO) narcissism on environmental, social, and governance (ESG) reporting. The study relies partly on hand‐collected, visual data and covers 57 German DAX 40 and MDAX companies from 2016 to 2020 (266 company‐year observations, Bloomberg database). Looking into the sub‐scores of ESG, CEO narcissism has a negative and linear relationship with environment and governance reporting but there is no significant relationship between narcissism and social reporting. Regression analyses further suggest a U‐shaped (quadratic) relation between CEO narcissism and ESG reporting: while low to moderate degrees of narcissism affect overall ESG reporting negatively, as CEO levels of narcissism increase so does the level of reporting. Moreover, further analysis has shown that the quantity of reporting is additionally positively related to ESG performance. The study applies and validates a relatively new but easily applicable measure of narcissism and extends narcissism research in the area of curvilinear relationships. We offer several further implications for human resource managers, regulators, auditors, and (non‐)financial analysts.
ISSN:1099-0836
0964-4733
1099-0836
DOI:10.1002/bse.3375