The Impact Of CEO’s Government Work Experience On The ESG Performance Of Enterprises

ESG(Environment,Society and Governance)evaluation index is a comprehensive index related to environment,society and corporate governance.It is no longer limited to financial performance,but comprehensively reflects the company’s environmental responsibility,social responsibility and corporate governance performance.At present,a large number of scholars have deeply demonstrated that ESG will play a positive role in micro-enterprises and China’s economy.The ESG investment concept advocated on this basis will help China achieve the "double carbon goal" and achieve high-quality development.At present,scholars focus more on what economic results ESG will produce.Few scholars trace back to explore what factors will affect ESG performance of enterprises.Based on this,this paper will discuss what will affect ESG from the perspective of influencing factors.According to the high-level echelon theory and branding theory,it is believed that the past experience of senior executives will have an impact on the company’s performance.This paper focuses on the CEO who has more influence on the company’s business decisions,and attempts to explore whether the CEO’s government work background will have an impact on the company’s ESG performance.What is more,what is the impact mechanism of ESG’s performance from the CEO’s government work background.In this paper,the fixed effect model,the intermediary effect model,the adjustment effect model,the instrumental variable method and Bootstrap method are used for empirical analysis.By constructing the CEOs’ government work experience index and adopting the OLS basic regression model with two-way fixed effect,the paper verifies the main assumptions: Does the CEO’s government work experience have an impact on the company’s ESG performance? At the same time,divide the ESG indicator into three indicators,E,S and G,and explore which dimension the CEO’s government work experience has the greatest impact on.In the aspect of mechanism analysis,the intermediary effect of debt financing cost and business risk is tested;By testing the cross-product item,we study whether the nature of ownership of the company has a regulatory effect.In addition,the paper also deepens the discussion on the impact of CEO’s government work experience on ESG through the 2SLS endogenous test of instrumental variables,other robustness tests and heterogeneity analysis.The main conclusion of this paper is that the CEO’s government work experience will significantly improve the company’s ESG performance.After the robustness test of instrumental variable method(IV),lag one period,replacement variable and other methods,the conclusion is still valid.At the same time,the instrumental variable,the nature of the CEO’s first job,will have an impact on the company’s ESG performance,confirming the branding theory.In terms of separation,the CEO’s government work experience has a significant positive effect on the E and S dimensions,but not on the G dimension.In terms of the mechanism,the CEO’s government work experience will improve the company’s ESG performance by reducing the two intermediary effects of debt financing costs and operating risks.Besides,The property nature of enterprises will play a regulatory role in the main regression,and the nature of state-owned enterprises will weaken the impact of the CEO’s government background on ESG.In terms of heterogeneity,it is found that the positive effect of CEO government work background on ESG is more obvious in companies listed on the main board,but not in non-main board companies;The positive effect of CEOs is significant both in the local office and in the off-site office,but the positive effect of CEOs in the local office is stronger than that of CEOs in the off-site office.According to the empirical conclusions,the corresponding suggestions are put forward for enterprises and government regulators respectively.Under the background of the current goal of "carbon peak,carbon neutral",the company,as the main body of today’s economic society,should not only consider its own financial performance,but also pay attention to the concept of green and sustainable development.This paper will have certain reference value for the company and regulators’ decision-making.In addition,the research perspective of upward traceability will also provide new ideas and references for other scholars to conduct in-depth research on ESG.