Chasing the light or chasing the dark? top managers’ political ties and corporate proactive environmental strategy

Abstract

ABSTRACT Corporate proactive environmental strategies (PESs), which are guided by proactive pollution prevention instead of passive pollution control, have attracted much attention from academia and industry in recent years. Thus, many previous studies have examined how manufacturers can be motivated to adopt PESs. Drawing on social embeddedness theory, this study investigates the main effect of executives’ political ties (PTs) on PES and the contingent role played by executives’ environmental awareness (EA) in this relationship. Considering the light and dark sides of PTs, this study proposes two competing hypotheses regarding the relationship between PTs and PES. Through a moderator analysis, this study further classifies EA into environmental risk awareness (ERA) and environmental cost–benefit awareness (ECA) and argues that these two types of environmental cognition play different roles in the relationship between PTs and PES. Using survey data collected from 167 Chinese manufacturing firms, the empirical analysis results show that executives’ PTs are positively and significantly related to corporate PES. This positive relationship is strengthened for firms with executives with high ERA but weakened for firms with executives with high ECA.