Influence of Communist Ideology on Corporate Sustainability: Analyzing the Role of CEO Capital and Characteristics

ABSTRACT Over a century of development, the Communist Party of China has effectively integrated its policies and practices, blending communist ideology with entrepreneurial spirit, and extending its influence into corporate management. However, the impact of communist ideology on business development, particularly on sustainable practices, has yet to be confirmed. Against this backdrop, this study uses data from publicly listed companies between 2011 and 2020 as the primary dataset, employing a double fixed‐effects model to analyze the relationship between ideology (Communist and non‐Communist CEOs) and corporate sustainability. We found that, compared to non‐Communist CEOs, Communist CEOs contribute to promoting corporate sustainability. Social and political capital exhibit a partially complementary effect in the relationship between communist ideology and corporate sustainability. Specifically, social capital strengthens the positive impact of Communist CEOs on corporate sustainability, while the role of political capital remains unclear. Notably, the political capital of Communist CEOs who have held positions at the department or bureau level is significantly effective. Communist CEOs who are older, female, highly educated, or have longer tenures tend to lead their companies toward stronger sustainable development outcomes. Party organization, the quality of information disclosure, and board governance were found to be potential pathways through which Communist CEOs influence corporate sustainability. These findings offer new insights into the enduring development of ideology and its integration with corporate sustainability.