Geopolitical Risk and Ownership Decision in Green Overseas Investment: Dual Moderation of Corporate Green Technology Capability and Host Green Governance

Round 1

Reviewer 1 Report

Comments and Suggestions for Authors

• suggest to meaningfully reduce and simplify your title
• try to explain why there is such a negative correlation btw green investing and GPR. what do green governance and terrorism for example have in common? what is the mechanism? one hypothesis that is well aligned with the financial literature would be that higher risk (GRP) demands a higher return, and green governance / tech can increase the expected return of investment. you mention an hypothesis in row 238-240, which deserves to be expanded / reviewed (agility of MNEs to adjust). you mention another explanation for this mechanism (protect intellectual property) in row 251-252.
• try to insert your research into bigger research currents. the idea that green tech / governance can attract more investments is aligned with the literature on corporate outperformance related to ESG. this is strong debate in academia on the relationship between ESG and financial considerations (see The Role of Transition Finance Instruments in Bridging the Climate Finance Gap by Pauline Deschryver, Frederic de Mariz :: SSRN; Flammer on green bonds; Edmans on ESG). Your research suggests that green attributes can attract higher levels of investing, in the case of long term international FDIs – I understand this is the key message in your research. the idea that higher risk (GPR) leads to lower levels of equity investment is not too innovative
• finally, are you able to quantify how green tech and green governance offset / balance GPR. if GPR reduces investment by xx%, how much of that negative impact can be offset by green aspects? are you able to mention which factor is stronger (tech or govenance)?
• are those relationships stronger in some countries versus others? consider looking at sub-samples within BRI

 

Detailed comments:

row 21. there are implications for countries also, not just for MNEs, in terms of improving green governance, which can arguably be easier than reducing GRP

row 30. list those countries – explain what is the geographical scope of BRI. define if there is a BRI organization or forum that is worth mentioning. that will help your reader understand the relevance of the concept. the concept of BRI wont be obvious to all readers. if countries within BRI are so diverse, justify why it makes sense to look at them as a group

row 105. define BvD

row 110. definition of “green technology host of Chinese entreprises”, suggest to reword to make it clearer

row 112. definition of “green governance”

row 162. Consider reformulating the “broken zone of geopolitics”, not clear what this means

row 166. is there a clear, explicit, organized “green investment project by Chinese enterprises”, provide more context

row 178. what would be an alternate “more flexible entry mode” for Chinese companies.

row 205. “green technology capability”: is there a source or theoretical framework for this concept?

row 214. what is the source for this “misconception”. if there is no source, suggest to remove this comment

row 262. suggest to be clearer on the definition of “green governance”. what is the source for this concept

row 472. to make it easier for readers, suggest to add here the different Hypotheses right before table 3

row 628. conclusion is too long and should not have two sub sections. suggest to use the conclusion simply to summarize key messages, suggest a few ideas for future research. you can incorporate the longer parts of the conclusion into the body of the paper.

 

end.

Author Response

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Author Response File: Author Response.pdf

Reviewer 2 Report

Comments and Suggestions for Authors

This study examines ownership share decisions of overseas investment firms under geopolitical risk. The study found that geopolitical risk leads firms to opt for lower-share ownership structures.

The conclusion is in line with the expectation, and this study is also worthy of affirmation. However, I have several concerns.

First, this study claims to be a green overseas investment, which has two problems. First, how the data define green overseas investment; Second, is there any difference between green overseas investment and other overseas investment?

Second, the econometric model of empirical analysis is wrong.

Third, the title is too long, I suggest shortening the title, is the subtitle needed?

The fourth is why the empirical analysis introduces the enterprise's green technology capability into the model as a regulatory effect, while the government's green governance is introduced as a categorical variable.

Fifth, although this study examines marginal changes in ownership structure. But I suggest that this can be further explored in a categorical way. Such as more than 50% ownership and less than 50% decision-making. This requires an examination of whether the firm chooses to reduce risk by taking less than a share (10%) or by sacrificing control (50%).

Sixth, how many countries are involved in the study sample and what is the sample situation in different countries? The manuscript appears to have used a small number of observational samples.

Seventh, whether geopolitical risks are endogenous challenges. There are large differences in economic characteristics between countries, and this study does not control for country-specific fixed effects.

Eighth, I look forward to theoretically convincing why green overseas investment is more closely related to geopolitical risk.

Final, this research needs to be further examined to improve the quality of writing and reduce errors.

Comments on the Quality of English Language

Language needs to be checked.

Author Response

Please see the attachment

Author Response File: Author Response.pdf

Reviewer 3 Report

Comments and Suggestions for Authors

The topic is too long please be short.

Can you update you data to 2022, now only 2020 year?

The overall research design is a little bit simple, no further texts, no cross-sectional texts. Please do more regressions.

Comments on the Quality of English Language

please revise 

Author Response

Please see the attachment

Author Response File: Author Response.pdf

Round 2

Reviewer 2 Report

Comments and Suggestions for Authors

The manuscript has been carefully revised.

Author Response

Comment: The manuscript has been carefully revised.

Response: Thank you very much for your positive feedback and for acknowledging the careful revision of the manuscript. We appreciate your time and effort in reviewing our work, and we are grateful for your valuable insights. Thank you again for your constructive feedback.