Family ownership as a boundary condition in the relationship between executive overconfidence and ESG disclosure: evidence from GCC family firms

Purpose This study examines whether family ownership moderates the relationship between Chief Executive Officer (CEO) overconfidence and environmental, social and governance (ESG) disclosure in emerging market firms. Rather than treating family ownership as a passive ownership structure, the study conceptualizes family control as a governance mechanism that shapes managerial discretion, executive ambition and sustainability-related decisions. Design/methodology/approach Using a panel dataset of 319 nonfinancial listed firms from Gulf Cooperation Council countries over the period 2014 to 2023, comprising 3,190 firm-year observations, the study measures ESG disclosure through a composite disclosure index and CEO overconfidence through an archival overconfidence proxy. Fixed-effects and dynamic system generalized method of moment (GMM) models are employed to address unobserved firm heterogeneity, persistence in ESG disclosure and potential endogeneity concerns. Findings The results show that overconfidence of the CEO is positively related to ESG disclosure, indicating that overconfident executives are more likely to disclose practices related to ESG. Interestingly, this relationship weakens in family-controlled firms, suggesting that family ownership restricts the degree to which executive psychological characteristics affect the decision of ESG disclosure. The results indicate that family ownership is a governance boundary condition determinant of the association between CEO overconfidence and sustainability disclosure. Originality/value This study contributes to family business and behavioral governance literature by showing that family ownership is not merely an ownership form but a socioemotional governance mechanism that shapes the strategic implications of executive psychological traits. By integrating Upper Echelons Theory with the Socioemotional Wealth perspective, the study offers new insights into the interaction between executive ambition, family control and sustainability disclosure in GCC emerging markets.