Effects of CEO Duality on Sustainability Disclosure and Firm Innovation

Abstract

Globalization and rapid technological changes are shifting firms towards innovative solutions to develop and survive in an undeniably competitive environment. As market competition has increased among organizations, the product life cycle has shortened significantly, and therefore firm innovation has become increasingly important for organizational developments. This study examines the impact of CEO duality on firm innovation in the top 100 largest US companies by market capitalization from 2015 to 2018. The result of this study reports CEO duality is negatively associated with innovation, and Sustainability disclosure partially mediates the effect of CEO duality and firm innovation. The present study contributes to the prior literature by the link between different CEO duality and innovation. This study is substantially beneficial for the scholars by expanding their attention from organizational and environmental factors to include the characteristics of the decision-makers, in particular CEOs involved in innovations. The present study contributes to the prior literature by examining the mediating effect of sustainability disclosure on the link between CEO duality and firm innovation.