Research

CEOs have significant influence on CSR

9 Apr 2021 By Jyoti Rambhai

Study reveals invested chief execs can boost the performance of their firms’ CSR activities by up to 30 per cent

CEOs have a large influence over firms’ corporate social responsibility (CSR) activities, new research has revealed.

A study into the so-called ‘CEO effect’ by academics at HEC Paris and the University of Antwerp found invested CEOs were responsible for improving the performance of their businesses’ CSR activities by up to 30 per cent.

HEC’s Georg Wernicke said they looked at CSR because policy in this area is voluntary and goes “well beyond what’s mandated by law”. It is also less prone to influence from factors beyond the CEO’s immediate control, such as the company’s financial performance.

Statistical techniques and data from 1,200 US organisations from 1993 to 2015 were used to analyse the impact of CEO clout and outcomes of CSR-type activities over time.

“Beyond CSR, our findings suggest it is likely that CEOs will exert quite a lot of influence on the firms they run in general,” said Wernicke. Therefore, their views, values, position on climate change and even how they treat employees “matter a great deal” and will influence workplace culture.

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