Climate Policy Uncertainty and the Green Returns to Outward Foreign Direct Investment: A Synergistic Dampening Perspective

As climate conditions become increasingly extreme, greater emphasis should be placed on environmental considerations in outward investment to achieve sustainable green development for Chinese enterprises. Therefore, based on panel data of Chinese listed enterprises from 2008 to 2023, this study examines the impact of Outward Foreign Direct Investment (OFDI) and climate policy uncertainty (CPU) on corporate green total factor productivity (GTFP). The findings indicate that OFDI significantly enhances GTFP, but CPU weakens this positive effect. Mechanism analysis reveals that OFDI improves corporate GTFP through promoting green management innovation, deepening digital transformation, and increasing green investment, while CPU exerts negative effects by undermining these mechanisms. Heterogeneity analysis shows that the effect of OFDI is more pronounced for enterprises in eastern regions, non-heavy-pollution enterprises, and low-carbon-intensity enterprises. Furthermore, spillover effect analysis demonstrates that OFDI’s impact on corporate GTFP exhibits significant spatial boundary characteristics and time-varying evolutionary patterns. Finally, external incentives (government environmental subsidies) and internal drivers (climate risk) can hedge against the negative effects of the interaction between CPU and OFDI.