Does environmental regulation contribute to enterprise green innovation? Empirical data based on the mediation effect from the perspective of executive compensation

ABSTRACT

In the context of tightening resource and environmental constraints globally, it is urgent to promote enterprise’s green technological innovation through environmental regulation. This paper uses the panel data of Chinese listed companies from 2009 to 2019 to empirically test the relationship between environmental regulation and green technological innovation, and it also explores the transmission mechanism of executive compensation between these two. The main conclusions are as follows: (1) environmental regulation can promote enterprise green technological innovation. (2) Environmental regulation negatively influences the enterprise green technological innovation by reducing executive compensation. (3) The effect of environmental regulation on the promotion of green technological innovation of enterprise is higher in coastal areas than inland areas of China; while the effect of environmental regulation on the promotion of green technological innovation of enterprise is higher in state-owned enterprises than others.

KEYWORDS:

• Environmental regulation
• enterprise green innovation
• executive compensation
• mediation effect

Disclosure statement

No potential conflict of interest was reported by the author(s).

Additional information

Funding

This work was supported by Key R&D and Promotion Special Project of Henan Province (Soft Science Research) ‘Research on the Realization Mechanism and Path of Ecological Product Value of Core Water Source of the Middle Route of South-to-North Water Transfer Project’ [grant number 222400410105].

Notes on contributors

Li Xiaofang

Li Xiaofang is an associate professor of Nanyang Institute of Technology since 2018. She is now studying for a DBA at the City University of Macau. She is the author of four books, seven articles form core papers(1 cssci), four provincial scientific research projects and three municipal research projects, two of which won the first prize of provincial and municipal outstanding achievements. Her research interests include Corporate Governance and Regional Economy.

Li Zhuohang

Li Zhuohang is an Assistant Professor at City University of Macau since 2018. He received the PhD in Management from the Macau University of Science and Technology. He has published 5 articles in SCI and core journals. His research interests include sociology and management.