Early Life Experience and CEOs’ Reactions to the COVID-19

CEO’s Childhood Experience of Natural Disaster and CSR Activities

“…Finally, we extend the literature related to the corporate outcomes for CEOs with childhood natural disaster experience. While previous research tends to focus on corporate-level financial policies (Bernile et al, 2017 ; Chen et al, 2021 ; Dessaint & Matray, 2017 ; Yao et al, 2020 ), innovation (Chen et al, 2022 ), and COVID-19 crisis management (Ru et al, 2022 ), our findings demonstrate that a CEO’s childhood natural disaster experience positively affects their CSR decisions. Therefore, this study contributes to the CSR literature by identifying CEO’s childhood natural disaster experience as an antecedent of a firm’s CSR activities.…”

“…In the disaster literature, some evidence suggests that exposure to traumatic events such as war at a young age has a lasting impact on the victim’s life, even as long as five decades later (Choi & Jung, 2021 ; Kim & Lee, 2014 ). Recent findings in this line of research in business also strongly favor the long-lasting effect of natural disasters experienced by CEOs in childhood, as manifested in subsequent corporate-level decisions made later in their life (e.g., Bernile et al, 2017 ; Chen et al, 2021 ; Ru et al, 2022 ; Yao et al, 2020 ). However, since these studies largely focused on a firm’s financial policies rather than CSR as a likely outcome, it is important to explore what explains the relationship between CEOs’ childhood natural disaster experience and a firm’s CSR performance and what boundary conditions might exist.…”

“…Exposure to traumatic events in childhood makes individuals more sensitive to the consequences of taking risks as they focus on the downside of the risk, such as fatalities, and therefore makes them more sensitized to the consequences of risk-taking and in turn implement more risk-averse and conservative corporate policies. Therefore, firms led by CEOs who experienced trauma including a natural disaster, war, or famine in early life reduce R&D investments (Chen et al, 2022 ; Ru et al, 2022 ) and increase financial information transparency (Choi & Jung, 2021 ) and quality (Yao et al, 2020 ), because they are more cautious about decisions that increase firm risk.…”