New study shows: Sustainability-oriented remuneration reduces irresponsible corporate behavior

New study shows: Sustainability-oriented remuneration reduces irresponsible corporate behavior

Dresden, October 2025.
A recent publication by Dr. Philipp Richter provides new insights into how incentives for sustainable management can positively influence corporate behavior. The study, published in the renowned journal Review of Accounting and Finance, examines whether linking executive compensation to corporate social responsibility (CSR ) objectives helps to reduce corporate social irresponsibility (CSiR).

The analysis is based on data from 1,763 US companies from 2011 to 2019. The result: companies that integrate CSR criteria into their remuneration systems behave significantly more responsibly - especially in dynamic industries where markets and stakeholder requirements are in a state of flux. In resource-rich ("munificent") environments, on the other hand, the effect is less pronounced.

"Our results show that CSR incentives not only promote positive social behavior, but can also prevent harmful behavior," explains Dr. Richter. "They therefore make an important contribution to responsible corporate governance."

The study provides practical insights for supervisory boards, remuneration committees and political decision-makers. It underlines that CSR-linked remuneration systems can be an effective governance tool - provided they are adapted to the respective environmental and industry conditions.

The full article is freely available at DOI 10.1108/RAF-11-2024-0481.