Business Commons^™

Prosocial Ceos, Corporate Policies, And Firm Value, Mei Feng, Weili Ge, Zhejia Ling, Wei Ting Loh

Research Collection School Of Accountancy

This paper examines how chief executive officers' (CEOs') prosocial tendency influences corporate policies and firm value. We use individuals' involvement with charitable organizations as a proxy for prosocial tendency. We find that, compared to firms with non-prosocial CEOs, firms with prosocial CEOs have lower executive subordinate turnover, implement more employee-friendly policies, experience higher customer satisfaction, and engage in more socially responsible activities. We also find that firms with prosocial CEOs have higher value and lower risk, partly due to the corporate policies adopted by prosocial CEOs. These results are corroborated when we compare changes in corporate policies and firm value …