How does D&O insurance affect corporate environmental investment?
Directors’ and officers’ liability insurance (D&O insurance), an important tool for diversifying and transferring risks of managers, plays a crucial role in corporate investment decisions, including corporate environmental investment decisions. However, the relationship between D&O i...
| Main Authors: | , , |
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| Format: | Article |
| Language: | English |
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Frontiers Media S.A.
2022-09-01
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| Series: | Frontiers in Environmental Science |
| Subjects: | |
| Online Access: | https://www.frontiersin.org/articles/10.3389/fenvs.2022.960097/full |
| _version_ | 1828282388452474880 |
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| author | Jiamin Liu Yalin Jiang Shengdao Gan |
| author_facet | Jiamin Liu Yalin Jiang Shengdao Gan |
| author_sort | Jiamin Liu |
| collection | DOAJ |
| description | Directors’ and officers’ liability insurance (D&O insurance), an important tool for diversifying and transferring risks of managers, plays a crucial role in corporate investment decisions, including corporate environmental investment decisions. However, the relationship between D&O insurance and corporate environmental investment remains unknown. Using a sample of Chinese listed firms, this study examines whether and how D&O insurance affects corporate environmental investment from 2008 to 2019. We find that D&O insurance is negatively associated with corporate environmental investment. This result is consistent with the results of a series of robustness tests. Further analyses show that D&O insurance impedes corporate environmental investment by driving executives to seek private benefits, especially monetary benefits. Moreover, the negative effect of D&O insurance on corporate environmental investment is more pronounced in low-polluting and highly competitive industries. However, this negative relationship is mitigated by political connections. The findings contribute to the literature by providing empirical evidence of the involvement of D&O insurance in influencing corporate environmental investment decisions. |
| first_indexed | 2024-04-13T08:28:29Z |
| format | Article |
| id | doaj.art-e889436fb7f84cf792381426d2ec1bbb |
| institution | Directory Open Access Journal |
| issn | 2296-665X |
| language | English |
| last_indexed | 2024-04-13T08:28:29Z |
| publishDate | 2022-09-01 |
| publisher | Frontiers Media S.A. |
| record_format | Article |
| series | Frontiers in Environmental Science |
| spelling | doaj.art-e889436fb7f84cf792381426d2ec1bbb2022-12-22T02:54:20ZengFrontiers Media S.A.Frontiers in Environmental Science2296-665X2022-09-011010.3389/fenvs.2022.960097960097How does D&O insurance affect corporate environmental investment?Jiamin Liu0Yalin Jiang1Shengdao Gan2School of Economics and Management, Hubei University of Technology, Wuhan, ChinaSchool of Social Audit, Nanjing Audit University, Nanjing, ChinaBusiness School, Sichuan University, Chengdu, ChinaDirectors’ and officers’ liability insurance (D&O insurance), an important tool for diversifying and transferring risks of managers, plays a crucial role in corporate investment decisions, including corporate environmental investment decisions. However, the relationship between D&O insurance and corporate environmental investment remains unknown. Using a sample of Chinese listed firms, this study examines whether and how D&O insurance affects corporate environmental investment from 2008 to 2019. We find that D&O insurance is negatively associated with corporate environmental investment. This result is consistent with the results of a series of robustness tests. Further analyses show that D&O insurance impedes corporate environmental investment by driving executives to seek private benefits, especially monetary benefits. Moreover, the negative effect of D&O insurance on corporate environmental investment is more pronounced in low-polluting and highly competitive industries. However, this negative relationship is mitigated by political connections. The findings contribute to the literature by providing empirical evidence of the involvement of D&O insurance in influencing corporate environmental investment decisions.https://www.frontiersin.org/articles/10.3389/fenvs.2022.960097/fullD&O insurancecorporate environmental investmentprivate benefitsmonetary benefitspolitical connections |
| spellingShingle | Jiamin Liu Yalin Jiang Shengdao Gan How does D&O insurance affect corporate environmental investment? Frontiers in Environmental Science D&O insurance corporate environmental investment private benefits monetary benefits political connections |
| title | How does D&O insurance affect corporate environmental investment? |
| title_full | How does D&O insurance affect corporate environmental investment? |
| title_fullStr | How does D&O insurance affect corporate environmental investment? |
| title_full_unstemmed | How does D&O insurance affect corporate environmental investment? |
| title_short | How does D&O insurance affect corporate environmental investment? |
| title_sort | how does d o insurance affect corporate environmental investment |
| topic | D&O insurance corporate environmental investment private benefits monetary benefits political connections |
| url | https://www.frontiersin.org/articles/10.3389/fenvs.2022.960097/full |
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