Nascent ventures’ green initiatives and angel investor judgments of legitimacy and funding

This study investigates the effects of entrepreneurs allocating time and resources for pro-social initiatives on the perceptions of potential financial investors. Conducting two experiments, we investigate these effects and report findings that suggest corporate social responsibility initiatives may lead to increased favorable judgments of legitimacy, which in turn, facilitate obtaining funding from financial investors. We also find that these effects are more likely to occur in environments marked by low levels of dynamism. The contribution of this research is both novel and important, as it is concerned with entrepreneurs who are uniquely not necessarily concerned with being regarded as “green,” but may incorporate green initiatives in their for-profit ventures. Therefore, this study improves our understanding of how non-green entrepreneurs who act upon their pro-social values may be perceived by financial investors.