CEO Divorce and Corporate Social Responsibility: Are Divorced CEOs More Generous?

Abstract

We build on the evolutionary psychology of generosity to understand how a CEO’s divorce influences their firm’s Corporate Social Responsibility (CSR) initiatives. Evolutionary psychology explains that the absence of a partner imposes adaptive constraints, and leaders that demonstrate concern for others as well as for the environment are likely to improve their fitness by attracting a new partner. This suggests that compared to married CEOs, divorced CEOs will be more positively inclined towards CSR. This effect, we argue, increases the longer it has been since the CEO went through a divorce, is stronger for female CEOs, and when CEOs have more children. Using a matched sample of female and male CEOs from leading US firms, we found strong support for our theoretical model. It offers new insights on the link between CEOs’ personal values and firm-level actions that elaborate the role of evolutionary adaptations in the microfoundations of CSR.