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CEO cultural heritage and corporate social responsibility

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  • Sarker, Md Showaib
  • Elnahas, Ahmed

Abstract

We examine the impact of CEOs' cultural heritage on corporate social responsibility. CEOs originating from countries with high Power Distance have high CSR scores, while those originating from Individualistic and Indulgent cultures have low CSR scores. This effect lasts up to three generations before it disappears due to acculturation. These results are robust to using propensity score matching, entropy balancing, Difference-in-Differences (DiD) estimation around CEO turnover, and a subsample of founder CEOs to address endogeneity and selection bias. Our findings shed light on the formation process of managers' intrinsic motives for prosocial behavior and hence improve our understanding of insider-initiate corporate philanthropy.

Suggested Citation

  • Sarker, Md Showaib & Elnahas, Ahmed, 2025. "CEO cultural heritage and corporate social responsibility," Journal of Corporate Finance, Elsevier, vol. 94(C).
    • Handle: RePEc:eee:corfin:v:94:y:2025:i:c:s0929119925001257
    DOI: 10.1016/j.jcorpfin.2025.102857
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    JEL classification:

    • G30 - Financial Economics - - Corporate Finance and Governance - - - General
    • G4 - Financial Economics - - Behavioral Finance
    • G40 - Financial Economics - - Behavioral Finance - - - General
    • G41 - Financial Economics - - Behavioral Finance - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making in Financial Markets
    • M14 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - Corporate Culture; Diversity; Social Responsibility
    • Z1 - Other Special Topics - - Cultural Economics

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