Bluer skies and clearer rivers? Returnees as silver bullets for pollution abatement in an emerging economy

Abstract

Emerging economies are burdened with multiple tasks related to economic development and environmental protection. Based on the phenomenon of “brain gain,” we examine whether overseas-returned executives (“returnees”) help emerging economies better cope with this multitasking. Drawing insights from a Chinese listed firm dataset for the period 2010–2020, this study provides significant observations regarding returnees' influence on firms' environmental performance. The findings show that hiring returnees makes firms greener for three main reasons. First, returnees enjoy favorable treatment provided by the worksite, and the mood of giving back makes them inclined toward low-pollution development. Second, returnees have more green skills. Third, returnees alleviate the principal–agent problem of firms in green development. There are also some extended findings from this study. As inferred from the firms' environmental performance, returnees' overseas study experience may be more important than pure overseas work experience. Additionally, firms that green up by hiring returnees are not biased by firm seniority. Finally, if returnees are viewed as a scarce resource, conditional talent wars will emerge among firms. These findings provide insight into how emerging economies can balance economic development with environmental protection.