CEO foreign experience and corporate sustainable development: Evidence from China

This study examines the impact of CEO foreign experience on corporate sustainable development from the angle of firm green innovation. Using manually collected data of CEOs' foreign experience, we find that CEO foreign experience is positively associated with firm green innovation in China. The positive relationship between CEO foreign experience and green innovation (including green invention patents and green utility model patents) is more significant when the firm is state owned, when the firm has better corporate governance, and when the firm is subject to a better institutional environment. Further analyses indicate that both foreign work and foreign educational experiences matter; relative to experiences gained in underdeveloped countries, those related to developed economies tend to be more influential in facilitating green innovation. Finally, the documented association is robust to a series of robustness checks, including propensity score matching, instrumental variable approach, Heckman two-stage model, and the inclusion of firm fixed effects. Overall, this paper contributes to the upper echelons perspective, and it also offers clear practical implications through showing that hiring returnee CEOs can enhance firms' sustainable development, which could be of interest to policy makers in other emerging markets.