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ORIGINAL RESEARCH
Moving Towards Environmental Sustainability:
Executive Environmental Experience and
Corporate Environmental Investment
1
Economics and Management College, China University of Geosciences, 430078, Wuhan, China
2
Wuhan Institute of Industrial Innovation and Development, 430079, Wuhan, China
Submission date: 2024-10-07
Final revision date: 2024-12-10
Acceptance date: 2025-01-03
Online publication date: 2025-03-17
Corresponding author
KEYWORDS
executive environmental experienceupper echelon theoryfirm environmental investmentcorporate environmental attention
TOPICS
ABSTRACT
As environmental sustainability becomes increasingly critical to corporate strategies, firms must
adapt to growing environmental concerns and regulatory pressures. Despite substantial research on
environmental investment, the role of executive environmental experience remains underexplored.
We use text mining techniques to measure executive environmental experience and a two-way fixed
effects model to examine how executive environmental experience affects corporate environmental
investment decisions. Our analysis reveals that executives with strong environmental backgrounds
are more likely to drive significant investments in environmental initiatives. Our study also identifies
two key mechanisms: heightened environmental attention and enhanced green innovation, through
which executive experience influences corporate behavior. Heterogeneity analysis results show
that the effect of executive environmental experience is magnified when firms are located in regions
with high environmental penalties. Executive environmental experience significantly enhances the
environmental investment of heavy polluters compared to non-heavy polluters. Meanwhile, media
attention also amplifies the positive effect of executive environmental experience. The findings offer
new insights into the micro-level drivers of environmental investment and contribute to the growing
literature on corporate environmental governance. This research extends the upper echelon theory by
integrating environmental economics and provides valuable guidance for firms aiming to enhance their
sustainability practices.
CONFLICT OF INTEREST
The authors declare that they have no known competing financial interests or personal relationships that could have appeared to influence the work reported in this paper.
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