The impact of environmental subsidy on the performance of corporate environmental responsibility: Evidence from China

Abstract

Corporate environmental responsibility (CER) has become a critical factor for measuring the competitiveness of firms in China, and environmental subsidies may be a catalyst for promoting firms’ CER. This study uses data from Chinese A-share listed firms during 2010–2020. Using the instrumental variable two-stage least squares (IV-2SLS) method, we found that environmental subsidies significantly improve corporate environmental performance but have no significant impact on the disclosure and governance of pollution emissions. We find that environmental subsidies are better for chemical and energy firms with high pollution levels, provide incentives for non-state-owned firms to improve CER and that their effect in western and eastern China is better than that in the central region. We also found that corporate social responsibility plays a moderating role in environmental subsidies that affect CER. Finally, this study finds that environmental subsidies may crowd out corporate investments to improve environmental performance. Based on the above results, we provide the corresponding policy suggestions.

Evolutionary Mechanism of Government Green Development Behavior in Construction and Demolition Waste Recycling Projects: A Perspective of Ecological Compensation

“…In this paper, the Jacobi matrix is constructed by referring to Jiang et al [63], as shown in Equation (9). The stability of the equilibrium point of the replicated dynamic system can be obtained by analyzing the local stability of the Jacobi matrix.…”

“…Government green development behavior is an important initiative to address environmental management challenges, which mainly include incentive green development behavior and mandatory green development behavior [8]. Among them, incentives for green development behaviors include granting environmental subsidies and issuing tax breaks [9], promoting green consumption [10], etc. In contrast, strict regulation of the market and the issuance of mandatory and catalog regulations are mandatory green development behaviors [11].…”

Impact of Environmental Regulation on Corporate Green Technological Innovation: The Moderating Role of Corporate Governance and Environmental Information Disclosure

“…Environmental regulations (ERs) are an important means of reducing environmental pollution [2]. The public demands that the government introduce appropriate policies to deal with environmental pollution [3], and that companies take up their own corporate social responsibility, increase their environmental investment, and enhance their environmental efficiency [4]. Corporations can mitigate environmental pollution by enhancing production efficiency and upgrading through innovation in green technology [5].…”