Inovação ambiental e iniciativas gerenciais de redução de carbono: o efeito moderador do poder do CEO
| Autor | Victor Vasconcelos, Maisa de Souza Ribeiro |
| Cargo | Doutorando em Controladoria e Contabilidade (USP), Ribeirão Preto/SP, Brasil victordaniel@usp.br / Doutora em Controladoria e Contabilidade (USP) Professora Titular do Departamento de Contabilidade da FEARP (USP) maisorib@usp.br |
| Páginas | 1-20 |
1
Artigo
Original
Original
Paper
Revista Contemporânea de Contabilidade, Florianópolis, v. 20, n. 54, p. 01-20, 2023.
Universidade Federal de Santa Catarina. ISSN 2175-8069. DOI: ht tps://doi.org/10.5007/2175-8069.2023.e84757
Environmental innovation and managerial initiatives for
carbon reduction: the moderating effect of CEO power
Inovação ambiental e iniciativas gerenciais de redução de carbono: o efeito moderador do poder do
CEO
La innovación ambiental y las iniciativas de gestión de la reducción del carbon o: el efecto
moderador del poder del CEO
Victor Daniel Vasconcelos*
Doutorando em Controladoria e Contabilidade
(USP), Ribeirão Preto/SP, Brasil
victordaniel@usp.br
https://orcid.org/0000-0002-1756-6241
Maísa de Souza Ribeiro
Doutora em Controladoria e Contabilidade (USP)
Professora Titular do Departamento de
Contabilidade da FEARP (USP)
maisorib@usp.br
https://orcid.org/0000-0003-1165-1813
Primary contact address for correspondence *
Av. Bandeirantes, 3900, Monte Alegre, CEP: 14040-900 - Ribeirão Preto/SP, Brasil
Abstract
Drawing on legitimacy and stakeholder theories, this paper investigates how environmental innovation
affects managerial initiatives for carbon reduction and whether Chief Executive Officer (CEO) power
moderates this relationship. Based on a sam ple of 331 Latin American firms from 2010-2020, an index of
managerial initiatives for carbon reduction is the dependent variable. Feasible Generalized Least Squares
(FGLS) regression results indicate that environmental innovation positively influences managerial initiatives
for carbon reduction. The results also report that CEO power positively moderates this relationship. Further,
the presence of a corporate social responsibility (CSR) committee and firm size positively influence
managerial initiatives for carbon reduction, and leverage has a negative relationship with initiatives for
carbon reduction. The research reinforces the importance of environmental innovation in combating climate
change and global warming.
Keywords: Environmental Innovation; Carbon Reduction; CEO Power; Legitimacy Theory; Stakeholder
Theory
Resumo
Baseado nas teorias da legitimidade e stakeholders, este artigo investiga como a inovação ambiental afeta
as iniciativas gerenciais para a redução de carbono e se o poder do Chief Executive Officer (CEO) modera
esta relação. Foram analisadas observações de 331 empresas latino-americanas e como variável
dependente utilizou-se um índice de iniciativas gerenciais para redução de carbono. Os resultados da
regressão Feasible Generalized Least Squares (FGLS) indicam que a inovação ambiental influencia
positivamente as iniciativas gerenciais para a redução de carbono. Os resultados também mostram que o
poder do CEO modera positivamente esta relação. Além disso, o comitê de responsabilidade social
corporativa e o tamanho da empresa influenciam positivamente as iniciativas gerenciais para redução de
carbono e a alavancagem tem uma relação negativa com estas iniciativas. A pesquisa reforça a importância
da inovação ambiental no combate às mudanças climáticas e ao aquecimento global.
Palavras-chave: Inovação Ambiental; Redução de carbono; Poder do CEO; Teoria da Legitimidade; Teoria
dos Skakeholders
Resumen
A partir de las teorías de la legitimidad y los stakeholders, este artículo investiga cómo la innovación
ambiental afecta a las iniciativas de la gestión para la reducción de carbono y si el poder del CEO modera
esta relación. Sobre la base de una muestra de 331 empresas latinoamericanas entre 2010 y 2020, la
variable dependiente es un índice de iniciativas directivas para la reducción del carbono. Los resultados de
la regresión por Feasible Generalized Least Squares (FGLS) indican que la innovación ambiental influye
Environmental innovation and managerial initiatives for carbon reduction: the moderating effect of CEO power
2
Revista Contemporânea de Contabilidade, Florianópolis, v. 20, n. 54, p. 01-20, 2023.
Universidade Federal de Santa Catarina. ISSN 2175-8069. DOI: ht tps://doi.org/10.5007/2175-8069.2023.e84757
positivamente en las iniciativas gerenciales para la reducción de carbono. Los resultados también indican
que el poder del CEO modera positivamente esta relación. Además, la presencia de un comité de
responsabilidad social corporativa (RSC) y el tamaño de la empresa influyen positivamente en las iniciativas
de la gestión para la reducción del carbono, y el apalancamiento tiene una relación negativa con las
iniciativas para la reducción del carbono. La investigación refuerza la importancia de la innovación ambiental
en la lucha contra el calentamiento global.
Palabras claves: Innovación Ambiental; Reducción de carbono; Poder del CEO; Teoría de la Legitimidad;
Teoría de los Stakeholders.
1 Introduction
Firms are increasingly aware that they must follow environmentally friendly practices due to
environmental problems, such as climate change. Climate change is a significant threat to the planet, with
stakeholders demonstrating concerns about organizations' commitment to climate change issues (Albitar et
al., 2023). Accordingly, carbon management is becoming popular among firms worldwide (Jiang et al.,
2021), with them adopting policies and procedures for reducing greenhouse gas (GHG) emissions
(Mahmoudian et al., 2021). Managerial initiatives for carbon reduction are strategic plans, processes,
policies, and actions used to deal with the adverse consequences of climate change (Haque & Ntim, 2020), i.
e., it refers to the actions of firms to reduce carbon emissions (Datt et al., 2018), due to pressure to
implement strategies that reduce carbon emissions (Gössling et al., 2023). These initiatives are essential to
corporate performance because high levels of carbon performance send a positive message to the market,
demonstrating that the firm has good carbon management (Ganda, 2021). Therefore, more consumers are
interested in products that minimize environmental damage (S. Long & Liao, 2021). A solution found by firms
to minimize the impacts of their activities is environmental innovation.
Environmental innovation refers to new or m odified products, processes, techniques, and systems
that prevent or reduce environmental damage (Kemp & Pontoglio, 2011). Accordingly, eco-innovation
produces products that reduce carbon emissions and add value to the business (Mahmood et al., 2022).
This innovation can be developed b y firms or non-profit organizations of a social, technological, institutional,
or organizational nature (Rennings, 2000). Environmental innovation is associated with a range of benefits,
including superior economic performance (Andries & Stephan, 2019; Farza et al., 2021; X. Long et al.,
2017), improved public image (Liao, 2018b), and reduced stock price crash risk (Zaman et al., 2021). Jiakui
et al. (2023) suggest that eco-innovation can boost green production by reducing transaction costs and
improving risk management. Moreover, environmental innovation projects are more likely to be undertaken
by more environmentally concerned Chief Executive Officers (CEOs) (Aibar-Guzmán & Frías-Aceituno,
2021; Y. Wang et al., 2021).
CEO is responsible for policy formulation and corporate decision-m aking (Javeed et al., 2021). In this
regard, CEOs with comprehensive knowledge of the firm's activities tend to allocate resources efficiently to
create more value, including social value (F. Li et al., 2016; Rashid et al., 2020). Power refers to the ability of
individual actors to exercise their will (Finkelstein, 1992). In other words, power is an individual's relative
ability to change others' states (Keltner et al., 2003). CEO power refers to the CEO's ability to overcome
opposing situations with other directors and existing uncertainties by influencing the firm's major decisions
(Pucheta-Martínez & Gallego-Álvarez, 2021), even if opposed by other executives (Adams et al., 2005).
Maswadi and Amran (2023) argue that CEO power can be a resource monitoring mechanism. Powerful
CEOs can change sustainability investment by influencing corporate decisions (Francoeur et al., 2021;
Sheikh, 2019). Moreover, firms with powerful CEOs can reduce corporate so cial irresponsibility (Jain &
Zaman, 2020).
Previous studies dem onstrate the influence of environmental innovation on carbon emission
reduction (Cheng et al., 2021; Jiakui et al., 2023; Konadu et al., 2022; Luan et al., 2019; Meirun et al., 2021;
Töbelmann & W endler, 2020; L. Wang et al., 2020; Y.-J. Zhang et al., (2017) and the impact of CEO power
on sustainability performance (Breuer et al., 2022; Fabrizi et al., 2014; Francoeur et al., 2021; Jiraporn &
Chintrakarn, 2013; Jizi et al., 2014; Y. Li et al., 2018; Pucheta-Martínez & Gallego-Álvarez, 2021; W alls &
Berrone, 2017; Y. Zhang et al., 2022). However, no studies address the influence of environmental
innovation on managerial carbon reduction initiatives and the moderating role of C EO power in this
relationship. Thus, this study seeks to fill this gap by showing this relationship in Latin America.
Based on the discussion above, this research aims to examine the influence of environmental
innovation on managerial carbon reduction initiatives and to analyze the moderating role in this relationship.
Theoretically, the study is based on legitimacy and stakeholder theories. Legitimacy and stakeholder
theories emphasize the external pressures from society (Luo & Tang, 2021). These theories focus mainly on
the non-financial benefits of sustainability activities (Hussain et al., 2023). However, Le and Ferasso (2022)
argue that firms that take care of stakeholders' interests and ensure the legitimacy of their activities tend to
have a competitive advantage. Further, legitimacy and stakeholder theories suggest that sustainable firms
seek to maintain a positive image and meet stakeholder expectations (Moussa et al., 2022).
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