Does It Pay for Family Firms to Go Green? The Moderating Role of Familiness

Given the growing demand for corporate environmental responsibility (CER) and the global relevance of family firms (FFs), the current study aims to shed light on the link between CER and corporate financial performance (CFP) in the organizational setting of FFs. In particular, we verify the extent to which FFs' propensity for CER activities leads to better operating performance and greater company value. In doing so, we consider two specific aspects of familiness and verify whether firm age and family ownership moderate the link between CER and CFP among FFs. We base our analysis on an international sample of 335 FFs and a control group of non-FFs observed from 2009 to 2020. The findings indicate a positive impact of CER engagement on both accounting- and market-based performance measures, mainly for FFs. Moreover, our findings highlight firm age and family ownership as positive moderators of the CER/CFP link in the FF context, especially for profitability measures.