Big Egos Can Be Green: A Study of CEO Hubris and Environmental Innovation

Claudia Arena*, Giovanna Michelon, Grzegorz Trojanowski

*Corresponding author for this work

Research output: Contribution to journalArticle (Academic Journal)peer-review

46 Citations (Scopus)

Abstract

This paper examines whether and to what extent CEO personal traits (hubris, in particular) affect firm environmental innovation. Using the overarching theoretical framework of upper-echelons theory, the paper builds on the insights from the corporate strategy, innovation, and corporate social responsibility literatures. We also examine the moderating role of firm-specific features (e.g. organizational slack) and the external environment (e.g. market uncertainty) in this context. Based on a sample of UK companies operating in sensitive industries, we find that CEO hubris facilitates the engagement in green innovative projects. We also find that CEO hubris does not have a uniform effect: its effect on environmental innovation increases with the organizational slack, but weakens with the extent of environmental uncertainty. Our findings suggest that availability of resources per se is not enough to produce environmental innovation. Instead, it requires a stable external environment that enables the CEO with a hubristic personality to make a correct use of them.

Original languageEnglish
Pages (from-to)316-336
Number of pages21
JournalBritish Journal of Management
Volume29
Issue number2
DOIs
Publication statusPublished - 1 Apr 2018

Structured keywords

  • AF Accountability Sustainability and Governance

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