Do Cultural Values Shape Responsible Global Expansion? Moderating Effects of Environmental Pressure and CEO Power on Chinese Firms’ OFDI Behavior

In the context of the global sustainability agenda, firms are increasingly expected to incorporate environmental considerations into their global expansion strategies. However, existing studies mainly focus on formal institutions and economic factors, while the role of informal institutions remains underexplored. This study examines how Confucian cultural values influence Chinese firms’ outward foreign direct investment (OFDI), particularly their investment behavior in environmentally stringent host countries, such as Germany, Sweden, and Canada. Using panel data of Chinese A-share listed firms from 2009 to 2024, this study employs panel regression analysis to test the effects of cultural values, environmental pressure, and CEO power. The results show that cultural values are positively associated with both OFDI intensity and the likelihood of investing in environmentally stringent countries. In addition, environmental pressure strengthens this relationship, whereas CEO power weakens it. This study contributes to the literature on responsible global expansion by highlighting the role of informal institutions and firm-level characteristics. The findings also provide practical implications for policymakers and firms seeking to promote environmentally responsible international investment behavior.