Does CEO Climate Change Attention Promote Corporate Social Responsibility?

The objective of this scientific study is to examine whether the climate change attention of the chief executive officer promotes corporate social responsibility. To perform the extensive calculations required for this analysis, the study utilizes comprehensive panel data sourced from Carbon Disclosure Project, KLD, and financial databases. The scientific research methods used include two-stage instrumental variable estimation and difference-in-differences approaches to rigorously establish a causal relationship. The results identify a significant positive correlation between chief executive officer climate change attention and overall corporate social responsibility. Specifically, this executive focus significantly improves external and internal corporate social responsibility while reducing socially irresponsible performance; however, it does not enhance material corporate social responsibility. Furthermore, the findings indicate that this positive effect is significantly amplified when chief executive officers are in the early stages of their careers or receive high compensation, particularly equity-based compensation. Additionally, the implementation of a corporate low-carbon strategy serves as an important mediating channel for improving social performance. In conclusion, executive cognitive attention is a fundamental determinant of a firm’s strategic behaviors. It is recommended that corporate boards structure equity-based compensation to align with sustainability goals and actively support low-carbon strategies to maximize the positive impact of executive attention on sustainable development.