ESG Ratings and CEO Charitable Stock Donations: Is Firm ESG Aligned With CEO Personal Philanthropy?

In the evolving landscape of sustainable investing, with unprecedented market attention on environmental, social, and governance (ESG) information, our study delves into the relationship between a firm's ESG ratings and the philanthropic behavior of its chief executive officer (CEO), particularly in terms of charitable stock donations. Examining US firms and utilizing comprehensive ESG data from Refinitiv, we find that ESG-rated firm CEOs engage in greater personal stock donation activity as compared to their non-ESG counterparts. They also appear to time donations in a less self-serving manner. When we isolate ESG firms, we find CEOs of the strongest ESG performers exhibit no self-interested timing behavior. Our study contributes to the sparse literature on CEO charitable behavior, shedding light on the potential alignment between ESG performance at the firm level and genuine, altruistic giving at the CEO level. Such alignment provides valuable insight for investors, policymakers, nonprofit organizations, and researchers interested in the intersection of sustainable investing and executive action.