This study aims to examine whether chief executive officer (CEO) narcissism exhibits a nonlinear effect on corporate carbon reduction in China and investigates how board oversight and board vigilance reshape the trajectory of that relationship.
Using a panel of 909A-share listed firms from 2014 to 2023, the study applies two-way fixed effects with Driscoll–Kraay standard errors. Endogeneity and robustness are addressed through instrumental variable estimation, propensity score matching, alternative specifications, nonparametric generalized additive model tests and a series of curve-shape diagnostics.
CEO narcissism shows an inverted U-shaped relationship with carbon reduction. At low to moderate levels, admiration motives promote reduction efforts; at higher levels, rivalry motives suppress them. Crucially, strong board vigilance is associated with a qualitative shift in this relationship, tending to reverse the trajectory toward a U-shaped pattern. Specifically, vigilance attenuates the negative curvature and provides suggestive evidence of a possible U-shaped reversal, sustaining more durable carbon reduction performance even at higher narcissism. In contrast, board oversight steepens the curvature and shifts the turning point leftward, amplifying extremes and accelerating the decline in reduction efforts.
This study integrates the narcissistic admiration and rivalry perspective into Upper Echelons Theory in China. It advances a dual pathway framework that links executive motives to corporate carbon reduction and contributes to board governance by distinguishing board oversight and board vigilance as separate processes with distinct managerial implications. The findings offer actionable guidance for Chinese boards, investors and regulators to align leadership motives with credible decarbonization.
