Research On The Impact Of Top Management Team’s Overseas Background Characteristics On Corporate Environmental Governance

With the rapid development of economy,China has also paid a very heavy environmental cost.Since the strategic decision of “Vigorously Promoting the Construction of Ecological Civilization” has been put forward,environmental governance has become a hot topic of wide concern to all sectors of society.Enterprises are the basic units of economic activities,and as an indispensable part of environmental governance,corporate environmental governance is related to the harmonious development of our economy and society.Most of the existing researches focus more on the external environmental and institutional factors,or the internal corporate governance structure factors to study the determinants of corporate environmental governance,while few explore from the individual level.However,as a maker and implementer of strategic decisions,the top management team(TMT)plays a decisive role in all aspects of corporate business management.Moreover,since 21 stcentury,a series of overseas talent introduction plans have been promulgated by our state and local governments,more and more senior executives with overseas backgrounds have gradually entered the public view.Therefore,it is not only of the theoretical significance but also of great realistic value to study whether and how the overseas background characteristics of TMT influence corporate environmental governance in this context.Taking the listed companies in China’s A share market during the period of 2010-2016 as research sample,basing on the Upper Echelons Theory and other related theories,manually collecting corporate environmental governance data from enterprises’ annual reports,this paper empirically examines the impact of TMT’s overseas background characteristics on corporate environmental governance by means of Tobit regression,Propensity Score Matching(PSM)method,SUREST test and other tests.In specific,firstly,we examine the relation between TMT’s overseas backgrounds and corporate environmental governance.Secondly,we investigate the regulatory effect of economic development level and industry attributes.Thirdly,we carry the further research by distinguishing overseas backgrounds into overseas study background and overseas work background.Last,we do a series of robustness tests.The conclusions of this study are as follows:(1)TMT’s overseas backgrounds help to improve the corporate environmental governance level.Enterprises that employ executives with overseas backgrounds will have higher level of corporate environmental governance,the higher the number and proportion of the executives with overseas backgrounds,the less the sewage charges levied by enterprises.(2)Economic development level and industry attributes play a regulatory role in the above relationship.When enterprises are in areas with higher economic development level,or belong to heavy polluting industries,the overseas background characteristics of TMT have a more obvious effect on improving corporate environmental governance level.(3)Both overseas study background and overseas work background help to improve the corporate environmental governance level,but they have different effects in some ways.The role of executives who has studied abroad in improving corporate environmental governance is more prominent in areas with higher level of economic development and heavy polluting industries.But the role of executives who has worked abroad in improving corporate environmental governance is more significant only in heavy polluting industries.(4)The influence of TMT’s overseas background on corporate environmental governance is realized through the mechanism of improving corporate environmental investment expenditure.(5)After carrying the PSM method and changing some index variables,the results of this study remain unchanged after a series of robustness tests.The conclusion of this paper shows that the overseas background characteristics of TMT have a positive impact on corporate environmental governance.This conclusion has the following revelations.First,it provides a new idea for enterprises to recruit and select high-level overseas talents,which means enterprises can improve the corporate environmental governance by integrating internal talent advantages and external institutional environment features from executives’ individual characteristics perspective.Second,it has some reference significances for investors and other related stakeholders to better evaluate corporate environmental performance.Last but not least,it also provides new evidence for the scientificity and rationality of our national overseas talent introduction plans.