CEO power and firm decarbonisation efforts

Using a global sample of 899 firms from 26 countries for the period 2000 to 2021, this study investigates the effect of CEO power on firms' decarbonisation efforts. We find that firms with higher levels of CEO power are associated with lower carbon emissions. Further analysis indicates that nationally diverse boards and older board members amplify the negative relationship between CEO power and carbon emissions. Similarly, powerful CEOs with high academic qualifications aggressively pursue corporate decarbonisation. The impact of CEO power on decarbonisation is more noticeable in carbon-intensive industries. Lastly, we document that climate legislation can be catalytic for decarbonisation. • Firms with powerful CEO are associated with lower carbon emissions. • Nationally diverse boards and older board members amplify the negative relationship between CEO power and carbon emissions. • Powerful CEOs with high academic qualifications are more aggressive in corporate decarbonisation. • Climate legislation can be catalytic for decarbonisation. • The impact of CEO power on decarbonisation is more pronounced in carbon-intensive industries.