Abstract
This study examines the relationship between Chief Financial Officer (CFO) overconfidence and firm performance through the lens of environmental violations and constituency statutes. Drawing on stakeholder and upper echelons theories, we find that firms with overconfident CFOs are more likely to commit environmental violations, which negatively impact their long-term performance. Our empirical evidence suggests that this effect can be moderated by the introduction of constituency statutes and violation penalties. Notably, firms with overconfident CFOs may benefit more from stakeholder-oriented laws while also incurring higher penalties for environmental violations.
| Original language | English |
|---|---|
| Pages (from-to) | (In-Press) |
| Number of pages | 24 |
| Journal | European Management Review |
| Volume | (In-Press) |
| Early online date | 8 Jun 2025 |
| DOIs | |
| Publication status | E-pub ahead of print - 8 Jun 2025 |
Bibliographical note
© 2025 The Author(s). European Management Review published by John Wiley & Sons Ltd on behalf of European Academy of Management (EURAM).This is an open access article under the terms of the Creative Commons Attribution License, which permits use, distribution and reproduction in any medium, provided the original work is properly cited.
UN SDGs
This output contributes to the following UN Sustainable Development Goals (SDGs)
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SDG 8 Decent Work and Economic Growth -
SDG 11 Sustainable Cities and Communities
Keywords
- CFO overconfidence
- constituency statutes
- environmental violations
- credit ratings
ASJC Scopus subject areas
- Finance
Themes
- Societal and Cultural Resilience
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