Chief sustainability officer appointment design and environmental outcomes: Distinguishing symbolic from substantive...

Although firms increasingly appoint chief sustainability officers (CSOs), it remains unclear whether such appointments generate substantive environmental change or primarily serve legitimacy goals. Drawing on symbolic management and institutional theory, this study argues that outcomes depend on the degree to which the CSO role is institutionally empowered. Empowerment is captured through a four pillar Substantiveness Index reflecting hierarchical authority, resource commitment, human-capital fit, and strategic embeddedness. Using a panel of 1259 European firms from 2012 to 2022, staggered adoption difference-in-differences estimates show that firms appointing substantive CSOs improve environmental performance, while firms appointing symbolic, title only CSOs exhibit no performance gains. More importantly, symbolic appointments are followed by a larger disclosure impact gap (GREENWASH), whereas substantive appointments reduce this gap. Two stage least squares analyses using peer policy shocks and CEO career ESG exposure as instruments yield consistent and slightly stronger estimates. The findings clarify when sustainability leadership roles become mechanisms of recoupling versus symbols that sustain legitimacy without equivalent environmental improvement, and they offer boards, investors, and regulators a practical diagnostic for assessing appointment credibility.