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Tone at the top: CEO environmental rhetoric and environmental performance

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  • Cong, Yu
  • Freedman, Martin
  • Park, Jin Dong

Abstract

In this study we attempted to ascertain the environmental leadership and commitment of the CEO as evidence of “tone at the top” in the belief that this would lead to enhanced environmental performance. We measure “tone at the top” by the environmental disclosure score which is collected from a content analysis of CEO letters to shareholders. We adopt the two environmental performance measures: (1) Environmental Impact Score (EIS) from Newsweek Green Ranking and (2) Modeled Hazard Population Results (MHPR) based on Risk-Screening Environmental Indicator (RSEI) models built by EPA. The results indicate that the environmental disclosure score from the CEO letter is inversely correlated with environmental performance. The overall findings support legitimacy theory in that CEOs essentially “spin” firms' environmental performance so it looks better than it actually is.

Suggested Citation

  • Cong, Yu & Freedman, Martin & Park, Jin Dong, 2014. "Tone at the top: CEO environmental rhetoric and environmental performance," Advances in accounting, Elsevier, vol. 30(2), pages 322-327.
    • Handle: RePEc:eee:advacc:v:30:y:2014:i:2:p:322-327
    DOI: 10.1016/j.adiac.2014.09.007
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    References listed on IDEAS

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    1. Cho, Charles H. & Patten, Dennis M., 2007. "The role of environmental disclosures as tools of legitimacy: A research note," Accounting, Organizations and Society, Elsevier, vol. 32(7-8), pages 639-647.
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    Cited by:

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    3. Jatta Pitkänen & Hanna Lehtimäki & Ari Jokinen, 2023. "Sustainability Project Champions as Environmental Leaders in a City Organization: Driving the Urban Circular Economy," South Asian Journal of Business and Management Cases, , vol. 12(1), pages 52-64, April.
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    5. Yongkyu Choi & Keun Tae Cho, 2021. "Analysis of Environmental Management Characteristics Using Network Analysis of CEO Communication in the Automotive Industry," Sustainability, MDPI, vol. 13(21), pages 1-23, October.
    6. Yuriko Nakao & Katsuhiko Kokubu & Kimitaka Nishitani, 2019. "Do Sustainability Reports Strategically Employ Rhetorical Tone? : An evidence from Japan," Discussion Papers 2019-01, Kobe University, Graduate School of Business Administration.
    7. Lorenzo Gelmini & Valentina Minutiello & Patrizia Tettamanzi & Maurizio Comoli, 2021. "Rhetoric, Accounting and Accountability: COVID-19 and the Case of Italy," Sustainability, MDPI, vol. 13(8), pages 1-21, April.
    8. Cecile K. Cho & Theresa S. Cho & Jessie Lee, 2019. "Managerial attributes, consumer proximity, and corporate environmental performance," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 26(1), pages 159-169, January.

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