THE EFFECT OF CEO POLITICAL IDEOLOGY: EXAMINING CORPORATE MISCONDUCT IN S&P 500 FIRMS
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2025-07-03
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en
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This study examined the effect of CEO political ideology on three types of corporate misconduct. This study aimed to provide more insights into why CEOs engage in corporate misconduct. Drawing on Upper Echelons Theory (Hambrick & Mason, 1984) and prior research on CEO values (e.g. Chin et al., 2013; Hutton et al., 2015), this study hypothesised that greater CEO liberalism is associated with less environmental violations and employee mistreatment and more financial misconduct. The analysis is based on data from S&P 500 firms in the period from 2010 to 2018. Negative binomial regression was used. The results of the study show that there is no significant relationship between CEO political ideology and corporate misconduct. Yet, sensitivity analysis revealed that board independence can act as a moderating influence between CEO political ideology and financial misconduct and environmental violations. The findings contribute to the literature on the antecedents of corporate misconduct and also highlight managerial discretion in Upper Echelons Theory (Hambrick & Mason, 1984) by showing that CEOs who have more freedom appear to act more in line with their political values.
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Faculteit der Managementwetenschappen