CEO military experience and firm-level climate-change exposure: moderating role of board gender diversity

Purpose Climate change risk is among the severe complexities that human society is facing, which also poses serious challenges to enterprise operations. This study aims to assess the extent of military culture’s imprint by providing empirical evidence on whether CEOs’ military experience improves or reduces firms’ climate-change risk. Design/methodology/approach This study employs pooled ordinary least squares (OLS) to investigate the relationship between CEOs’ military experience and firm-level climate change exposure. The study sample comprises mainland A-share listed enterprises from 2007 to 2022. Findings The outcomes of the given study provide evidence that CEOs with military experience mitigate the firm-level climate change exposure. Board gender diversity strengthens the nexus between CEO military experience and firm-level climate-change exposure. Furthermore, the channel analysis findings indicate that external monitoring partially amplifies the negative relationship between CEO military experience and firm-level climate change exposure. The cross-sectional analysis results indicate that the underlying nexus is more pronounced among enterprises with low competition intensity, political connections, located in low-carbon city pilot areas, and without CEO duality. Practical implications Overall, these outcomes underscore the need for accurate assessment of climate change exposure to inform strategic decisions. This study has several implications for corporations, governments, policymakers and other regulatory authorities. Originality/value The study contributes to the literature by identifying CEO military experience as a novel driver of firm-level climate risk, an area that has received scant attention in prior research. This study provides empirical support for the upper-echelon theory and the resource-based view by documenting how military background CEOs shape corporate strategic decisions in contexts of external environmental uncertainty. Furthermore, enrich the literature on the resource dependence theory by exploring the moderating role of board gender diversity.