Does a CEO from a reputable university create a better working environment? Evidence from Indonesia

Abstract

Purpose

This study aims to investigate whether CEOs who graduated from prestigious universities can provide a better-quality working environment.

Design/methodology/approach

Using a sample of 1,877 observations from all companies listed on the Indonesia Stock Exchange from 2019–2021, this research employs logistic OLS and coarsened exact matching (CEM) analyses to ensure robust results.

Findings

This study revealed that companies with CEOs who are alumni of a reputable university provide a high-quality working environment. These results are robust using the coarsened exact matching (CEM). Additional analyses exploring subindicators of working environment quality revealed that CEOs who have received an education from a reputable university have a better understanding of the importance of continuous education and training.

Practical implications

The findings of this study can provide guidance for managers and decision-makers in managing human resources and the work environment more effectively. By understanding the impact of high-quality education on leadership abilities in creating a supportive work environment, companies can be more strategic in recruiting and developing their leaders.

Originality/value

This study provides a unique contribution by providing empirical data on the quality of the working environment in Indonesia, specifically focusing on the role of CEOs from a reputable university as policy-makers, which has not been extensively explored in previous research.