How Much Do CEOs Matter for Corporate Social Performance?

How much of the total variance in corporate social performance (CSP) is explained by the CEO effect? To answer this question, we apply the novel 'CEO in Context' (CiC) variance partitioning technique recently suggested by Hambrick and Quigley (2014) to two of the most widely used CSP datasets, KDL and Asset4. The CiC technique allows distinguishing between the amount of variance in CSP explained by CEOs from that of contextual factors related to the industry or firm, for example. We find that firms and CEOs explain the majority of variation in CSP. The impact of CEOs is around 28.0 percent and, when estimated for different subcategories of CSP individually, remarkably stable. The CEO effect is smaller for corporate social irresponsibility than for social responsibility. [ABSTRACT FROM AUTHOR]