Legacy of ideology: The enduring effect of CEOs’ socialist ideological imprint on private firms’ employee-related CSR

Abstract

The question of how the legacy of ideology has an enduring effect on firms’ decisions remains largely unanswered. Drawing from the imprinting theory and corporate social responsibility (CSR) literature, in this study, we examined when and how chief executive officers’ (CEOs) socialist ideological imprints play an economically significant role in shaping firms' employee-related CSR (E-CSR) in China during its remarkable political transitions. We used data from 4,094 private Chinese firms as our sample and found that the socialist ideological imprints of private firms’ CEOs have a positive impact on the firms’ E-CSR decisions. Moreover, this imprinting effect was found to be more salient when CEOs joined the Communist Party of China before the political transition of Deng Xiaoping’s reform, but was found to be more constrained when CEOs perceived that the level of the guanxi requirements was high. This study sheds new light on how business leaders’ ideological imprints may have an enduring influence on their firms’ discretional CSR choices toward multiple stakeholders, particularly the employees. Moreover, it enhances the imprint literature by spotlighting the newly identified boundary conditions of imprinting effects upon firms’ CSR strategies.