Does environmental regulation promote corporate green investment? Evidence from China's new environmental protection law.
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| Title: | Does environmental regulation promote corporate green investment? Evidence from China's new environmental protection law. |
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| Authors: | Liu, Sheng1 (AUTHOR), Liu, Heming2 (AUTHOR), Chen, Xiuying3 (AUTHOR) chenxiuying1128@163.com |
| Source: | Environment, Development & Sustainability. May2024, Vol. 26 Issue 5, p12589-12618. 30p. |
| Subject Terms: | *Corporate investments, *Sustainable investing, *Environmental regulations, *Environmental protection, *Environmental law, *Environmental reporting, *Industrial concentration |
| Geographic Terms: | China |
| Abstract: | Green investment is crucial to achieving the green transformation goal. Under increasingly strict environmental protection laws and regulations, whether it can induce the "Porter Hypothesis" effect and stimulate the green investment of enterprises is still controversial. This paper takes the China's new environmental protection law (NEPL) as a quasi-natural experiment, uses the green investment data of listed companies in China's heavy pollution industry, and applies the method of propensity score matching and difference-in-difference (PSM-DID) to verify whether the implementation of the law conforms to the "strong Porter Hypothesis." The results show that as a strict command-and-control environmental regulation tool, the implementation of NEPL has significantly promoted corporate's green investments in heavily polluting industries. The implementation of the NEPL guides to more standardized environmental disclosure regulation, stricter environmental enforcement, and severer financial constraints, and thus propel corporate's green investment. In addition, heterogeneity analysis indicates that the effect of NEPL is more significant in those samples of enterprises located in the regions with higher industrial concentration degree or with higher level of government environmental governance, enterprises of small and medium type, and enterprises with better financial performance and higher degree of equity incentive. To achieve the carbon peaking and carbon neutrality goals, this paper provides evidence to test whether "Porter Hypothesis" is established in transition economies from the view of environmental investment and provides reference for how developing country can further enrich their environmental regulation system and optimize enterprise's environmental protection strategies. [ABSTRACT FROM AUTHOR] |
| Database: | Energy & Power Source |
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| Header | DbId: enr DbLabel: Energy & Power Source An: 176910638 AccessLevel: 6 PubType: Academic Journal PubTypeId: academicJournal PreciseRelevancyScore: 0 |
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| Items | – Name: Title Label: Title Group: Ti Data: Does environmental regulation promote corporate green investment? Evidence from China's new environmental protection law. – Name: Author Label: Authors Group: Au Data: <searchLink fieldCode="AR" term="%22Liu%2C+Sheng%22">Liu, Sheng</searchLink><relatesTo>1</relatesTo> (AUTHOR)<br /><searchLink fieldCode="AR" term="%22Liu%2C+Heming%22">Liu, Heming</searchLink><relatesTo>2</relatesTo> (AUTHOR)<br /><searchLink fieldCode="AR" term="%22Chen%2C+Xiuying%22">Chen, Xiuying</searchLink><relatesTo>3</relatesTo> (AUTHOR)<i> chenxiuying1128@163.com</i> – Name: TitleSource Label: Source Group: Src Data: <searchLink fieldCode="JN" term="%22Environment%2C+Development+%26+Sustainability%22">Environment, Development & Sustainability</searchLink>. May2024, Vol. 26 Issue 5, p12589-12618. 30p. – Name: Subject Label: Subject Terms Group: Su Data: *<searchLink fieldCode="DE" term="%22Corporate+investments%22">Corporate investments</searchLink><br />*<searchLink fieldCode="DE" term="%22Sustainable+investing%22">Sustainable investing</searchLink><br />*<searchLink fieldCode="DE" term="%22Environmental+regulations%22">Environmental regulations</searchLink><br />*<searchLink fieldCode="DE" term="%22Environmental+protection%22">Environmental protection</searchLink><br />*<searchLink fieldCode="DE" term="%22Environmental+law%22">Environmental law</searchLink><br />*<searchLink fieldCode="DE" term="%22Environmental+reporting%22">Environmental reporting</searchLink><br />*<searchLink fieldCode="DE" term="%22Industrial+concentration%22">Industrial concentration</searchLink> – Name: SubjectGeographic Label: Geographic Terms Group: Su Data: <searchLink fieldCode="DE" term="%22China%22">China</searchLink> – Name: Abstract Label: Abstract Group: Ab Data: Green investment is crucial to achieving the green transformation goal. Under increasingly strict environmental protection laws and regulations, whether it can induce the "Porter Hypothesis" effect and stimulate the green investment of enterprises is still controversial. This paper takes the China's new environmental protection law (NEPL) as a quasi-natural experiment, uses the green investment data of listed companies in China's heavy pollution industry, and applies the method of propensity score matching and difference-in-difference (PSM-DID) to verify whether the implementation of the law conforms to the "strong Porter Hypothesis." The results show that as a strict command-and-control environmental regulation tool, the implementation of NEPL has significantly promoted corporate's green investments in heavily polluting industries. The implementation of the NEPL guides to more standardized environmental disclosure regulation, stricter environmental enforcement, and severer financial constraints, and thus propel corporate's green investment. In addition, heterogeneity analysis indicates that the effect of NEPL is more significant in those samples of enterprises located in the regions with higher industrial concentration degree or with higher level of government environmental governance, enterprises of small and medium type, and enterprises with better financial performance and higher degree of equity incentive. To achieve the carbon peaking and carbon neutrality goals, this paper provides evidence to test whether "Porter Hypothesis" is established in transition economies from the view of environmental investment and provides reference for how developing country can further enrich their environmental regulation system and optimize enterprise's environmental protection strategies. [ABSTRACT FROM AUTHOR] |
| PLink | https://search.ebscohost.com/login.aspx?direct=true&site=eds-live&db=enr&AN=176910638 |
| RecordInfo | BibRecord: BibEntity: Identifiers: – Type: doi Value: 10.1007/s10668-023-03933-3 Languages: – Code: eng Text: English PhysicalDescription: Pagination: PageCount: 30 StartPage: 12589 Subjects: – SubjectFull: Corporate investments Type: general – SubjectFull: Sustainable investing Type: general – SubjectFull: Environmental regulations Type: general – SubjectFull: Environmental protection Type: general – SubjectFull: Environmental law Type: general – SubjectFull: Environmental reporting Type: general – SubjectFull: Industrial concentration Type: general – SubjectFull: China Type: general Titles: – TitleFull: Does environmental regulation promote corporate green investment? Evidence from China's new environmental protection law. Type: main BibRelationships: HasContributorRelationships: – PersonEntity: Name: NameFull: Liu, Sheng – PersonEntity: Name: NameFull: Liu, Heming – PersonEntity: Name: NameFull: Chen, Xiuying IsPartOfRelationships: – BibEntity: Dates: – D: 01 M: 05 Text: May2024 Type: published Y: 2024 Identifiers: – Type: issn-print Value: 1387585X Numbering: – Type: volume Value: 26 – Type: issue Value: 5 Titles: – TitleFull: Environment, Development & Sustainability Type: main |
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