Search Results (248)

This study proposes a dual-shield framework to elucidate the capital structure dynamics within China’s policy-intensive real estate sector. We delineate a coercive policy shield wherein binding regulations supersede market-based incentives, and a proactive sustainability shield which recognizes how superior environmental performance can lead to reduced financing costs. Analyzing data from Chinese A-share firms during 2003 to 2021, we present robust evidence that supports both mechanisms. Notably, the effect of the debt tax shield is diminished in real estate sectors, underscoring the policy shield’s ability to negate traditional financial incentives. In addition, the macroprudential tightening implemented in 2017 has disproportionately disrupted leverage adjustments, especially among firms subsequently affected by the “Three Red Lines” policy. Rigorous quasi-experimental analyses additionally illustrate that green bond issuers experience a significant and enduring reduction in their cost of debt, thereby establishing a substantive sustainability shield. Our findings contribute to the literature on sustainable finance by conceptualizing approaches that extend beyond tax shields, effectively integrating regulatory and market forces to align the capital structures with objectives for sustainable transition. Full article

As global climate change intensifies and the Paris Agreement advances low-carbon transformation, frequent local policy adjustments under China’s dual carbon goals have made climate-policy uncertainty a core challenge for corporate sustainability. Environmental, social, and governance (ESG) performance has grown exponentially in international capital markets, evolving from a peripheral concept to a key investment decision-making dimension. This study uses China’s carbon peaking and neutrality policies as a quasinatural experiment, applying the difference-in-differences (DID) method to the panel data of Chinese A-share listed companies (2014–2023). Taking high-energy-consuming enterprises as the treatment group, this study identifies net policy effects via the interaction of policy and time dummy variables. The results show that carbon peaking and neutrality policies significantly suppress the ESG performance of energy-intensive firms; mediating effect tests confirm that the policy harms ESG performance by increasing uncertainty. Implications include enhancing policy transparency and predictability and optimizing resource allocation to strengthen ESG resilience. Future research should focus on micro-level policy indicators and long-term effect tracking to provide theoretical and practical support for synergizing dual carbon goals with high-quality economic development. Full article

The revision and implementation of the Environmental Protection Law signaled a major transformation in China’s environmental regulatory paradigm—from a traditional command-and-control model to a more diversified and market-oriented approach. This shift has raised critical questions regarding the actual impact of regulation on green technological innovation. Using panel data from A-share listed firms in China between 2011 and 2022, this study employs a propensity score matching–difference-in-differences (PSM-DID) model to identify the causal effect of environmental regulation on green innovation. Results reveal that the enactment of the law significantly enhances firms’ green innovation capacity. Robustness tests confirm the stability of these findings. Further analysis identifies several potential transmission mechanisms. Specifically, we find robust empirical evidence that environmental regulation exerts its effects through elevated R&D investment levels and strengthened executives’ environmental awareness, while the financing constraint and environmental information disclosure channels yield suggestive yet less statistically robust results in indirect effect tests. Moreover, heterogeneous effects are more evident among non-state-owned enterprises, firms in the eastern region, and those in highly market-oriented provinces. This study contributes empirical evidence to the literature on environmental regulation and green innovation, and offers policy insights for improving environmental governance in emerging economies. Full article

This research examines the influence of environmental, social, and governance (ESG) strategies on corporate financial performance (CFP) in China’s automotive industry, characterized by intense regulatory pressure and fast-paced technological transformation. Using an unbalanced panel dataset of A-share listed automotive firms from 2009 to 2024, this paper combines ESG scores from the Huazheng ESG index with firm-level financial data from CSMAR. CFP is measured through both accounting-based (ROA) and market-based (Tobin’s Q) indicators. Panel regression models are applied to evaluate the influence of overall ESG performance and the three individual pillars, and to assess heterogeneity across ownership types, firm type, and firm age. The results show that ESG performance is significantly and positively associated with ROA, but is insignificantly associated with Tobin’s Q. It is suggested that ESG engagement improves accounting profitability but is not fully reflected in the capital market. Among the three ESG pillars, governance shows the strongest positive link with ROA, while environmental and social performance are weakly associated with ROA. Furthermore, the heterogeneity study shows that the positive relationship between ESG and CFP is more pronounced for non-state-owned firms, vehicle manufacturers, or mature firms. Overall, this paper presents fresh evidence on whether and how ESG initiatives can facilitate sustainable value in China’s automotive sector, offering insights for policymakers and management that may help this industry achieve sustainable growth. Full article

The institutional environment constitutes the external foundation for corporate development. In the process of China’s modernization, addressing the fiscal constraints on corporate green development is a key issue in advancing the green transformation of the economy, as well as a new approach to understanding the implementation gaps in environmental regulations and the challenges facing the development of green finance. This paper draws on new institutional economics theory to construct an analytical framework of “institutional incentives-behavioural choices-performance outcomes.” Using unbalanced panel data from 2008 to 2022 on listed companies in the Shanghai and Shenzhen A-share markets and prefecture-level cities, a two-way fixed effects model is employed to systematically examine the impact of fiscal vertical imbalances on the efficiency of corporate green development. Heterogeneity analysis reveals the ‘institutional sensitivity gradient’ phenomenon, with the inhibitory effects of fiscal vertical imbalances being particularly pronounced among institutionally sensitive groups such as labour and capital-intensive enterprises, heavily polluting enterprises, mature and declining stage enterprises, and eastern coastal enterprises. Fiscal vertical imbalances severely constrain the pace of green transformation in traditional enterprises and the growth of green industries. It is necessary to reconfigure the central-local fiscal relationship oriented toward green development, innovate ecological compensation and green debt coordination mechanisms, and establish an incentive-compatible institutional environment to resolve the “green paradox.” Full article

Global warming threatens sustainable human development, and carbon emission rights trading (CERT) has emerged as a key market-based tool for reducing emissions. Yet evidence on how CERT affects corporate green innovation—especially high-quality, substantive innovation—remains mixed and fragmented. Using unbalanced panel data on Chinese A-share listed firms from 2007 to 2016 and applying fixed-effect, DID, and PSM-DID models, this study examines the impact of China’s CERT pilot policy on quota-managed firms’ green innovation. The results show that the policy primarily stimulates substantive green innovation, reflected in green invention patents, with limited influence on strategic, low-novelty patents. Its effects are stronger for firms in central and western pilot regions, in non-high-tech industries, and at more mature stages of development, and differ between firms that anticipated regulation and those brought under quota management unexpectedly. Overall, the findings indicate that a well-designed carbon trading mechanism can reallocate resources to incentivize high-quality green innovation, offering micro-level support for Coasian market-based approaches to environmental externalities and informing the further development of China’s national carbon market. Full article

This paper constructs a two-way fixed effects model using data from 4623 Chinese A-share listed enterprises from 2011 to 2022, confirming that firm digital transformation can enhance access to sustainable trade credit. Specifically, for every 1% increase in the standard deviation of digital transformation, the trade credit obtained by enterprises increases by 2.14% in relation to their average value. We employed instrumental variable (IV) and propensity score matching (PSM) methods, utilizing the Broadband China pilot policy as a quasi-natural experiment to conduct a multi-period propensity score matching-difference in differences (PSM-DID) analysis to address potential issues of reverse causality and sample selection bias. Mechanism analysis indicates that the diversification of supplier structures, R&D innovation, and market share facilitated by digitalization are three main channels. This effect is particularly significant in state-owned enterprises, mature enterprises, and those with higher social trust. Finally, the study also found that the spillover effects of digital transformation encourage client enterprises to allocate credit resources to downstream firms, thereby promoting the sustainable development of supply chain finance. Furthermore, the digital transformation primarily alleviates short-term credit challenges for enterprises and reduces their reliance on bank credit. Full article

Under the background of accelerating global transitions towards low-carbon development, digital intelligence transformation (DIT) has become a critical force that helps companies overcome green technological constraints and translate external green pressures into substantive green innovation. Taking the establishment of China’s NAIIDTZs as a quasi-natural experiment, this study investigates the impact of DIT on corporate green innovation (CGI) from an internal decision-making perspective. Based on a panel dataset of 19,440 samples from Chinese A-share listed companies during 2012–2023, our findings show that DIT significantly enhances both the quantity and quality of CGI. Mechanism analyses indicate that DIT promotes CGI’s quantity through increased R&D human capital input, while improving CGI’s quality through managerial myopia reduction. Heterogeneity analyses further reveal that the positive effects of DIT on CGI are particularly pronounced in firms operating under fierce market competition, in high industrial technological intensity, and in eastern regions. Furthermore, we find that CGI exerts a lagged effect on carbon emission reduction performance, while the effect of CGI’s quality is stronger than that of CGI’s quantity. These findings extend the dynamic capacity theory to digitalization and provide practical and policy implications for promoting CGI through digital intelligence development. Full article

This study investigates the impact of city-level capital factor market integration on corporate ESG performance, using a sample of Chinese A-share listed companies from 2010 to 2024. We find that greater capital factor market integration significantly improves firms’ overall ESG performance. Mechanism analysis reveals that capital factor market integration operates through three channels: market competition, technological advancement, and attention reconstruction, enhancing both firms’ capabilities and incentives to engage in ESG activities. The positive effect is stronger for state-owned enterprises, firms in less polluting industries, and those in regions with high government environmental attention. Further analysis indicates that capital factor market integration suppresses corporate greenwashing behavior and reduces discrepancies across ESG rating agencies. Moreover, capital factor market integration exhibits asymmetric effects across ESG sub-dimensions, significantly improving environmental and governance performance while weakening social responsibility performance. This reflects firms’ preference, under competitive pressure, for environmental and governance domains characterized by shorter payback periods and more readily quantifiable outcomes, as well as their cautious stance toward the social responsibility domain where effects take considerably longer to materialize. This study contributes to understanding the micro-level mechanisms through which capital factor market integration influences corporate sustainable development, providing empirical evidence for China’s construction of a unified national market and the advancement of sustainable development strategies. Full article

This study investigates the “insurance-like effect” of corporate Environmental, Social, and Governance (ESG) performance amid financial restatement events among Chinese listed firms and examines the moderating role of ESG rating divergence. Employing an event study methodology on a sample of 1552 financial restatement events in China’s A-share market from 2013 to 2023, we measure market reactions using the cumulative abnormal return (CAR) over a [−1, +1] day window. Our findings reveal that strong ESG performance significantly mitigates the negative market reactions triggered by financial restatements. However, this protective effect of ESG is significantly weakened by the inconsistency in ESG assessments among rating agencies, known as ESG rating divergence, particularly when such divergence is persistent. We argue that the underlying mechanism is that rating divergence creates signal conflicts, exacerbates information asymmetry, and erodes the credibility of ESG signals. This, in turn, undermines the stakeholder trust and moral capital that underpin the insurance-like effect. This research sheds light on the complex impact of ESG rating divergence on the value-protective mechanism of ESG and contributes new empirical evidence to the literature on ESG and its insurance-like effect, especially within the context of an emerging market. Full article

Against the backdrop of China’s economic transformation and the transition towards sustainable industrial systems, optimizing ownership structures to enhance the resilience and bargaining power of manufacturing suppliers has become crucial for building sustainable supply chains. This study empirically examines the impact of ownership concentration on supplier bargaining power using data from manufacturing companies listed on the Shanghai and Shenzhen A-share markets from 2008 to 2022, integrating insights from principal-agent theory and industrial dynamics within a sustainability-oriented framework. The findings reveal: (1) Ownership concentration significantly strengthens the bargaining power of supplier enterprises, contributing to more stable and equitable supply chain relationships. (2) R&D investment plays a partial mediating role between ownership concentration and supplier bargaining power, suggesting that innovation efforts—often aligned with green and sustainable technologies—can reshape dependency dynamics. (3) Industry competitiveness negatively moderates the relationship between ownership concentration and supplier bargaining power, indicating that intense competition may undermine the governance advantages of concentrated ownership in sustainable value creation. (4) Heterogeneity analysis shows that the positive effect of ownership concentration is more pronounced in central and western regions, state-owned enterprises, and large firms, highlighting contextual factors in achieving sustainable supply chain governance. Full article

In the face of increasingly severe global environmental challenges, corporate environmental information disclosure (CEID) has become a critical link connecting national ecological governance goals with firms’ green development practices. From the perspective of green signaling, this study examines whether government environmental concerns (GEC) in China incentivize CEID and the mechanisms underlying this effect. We theoretically elaborate the transmission pathways and moderating effects of GEC, and measure GEC and CEID indicators using text analysis of local government work reports and corporate annual reports. Based on a series of empirical tests on Chinese A-share listed firms from 2008 to 2023, we find that: (1) GEC can significantly enhance CEID by attracting green investors and fostering greater media scrutiny. (2) Green technological innovation exhibits a masking effect, which reveals a counterintuitive mechanism whereby stringent environmental regulation may divert innovation resources toward pollution control investments. (3) The impact of GEC is positively moderated by external volatility such as climate policy and market uncertainty and internal capabilities such as firms’ digital transformation. (4) Further heterogeneity analysis shows that GEC has a more significant impact on non-state-owned enterprises, enterprises in heavily polluting industries, and those in the mature or declining stage. This study provides a new theoretical lens for understanding the dynamic interplay between institutional pressure and corporate behavioral responses, and offers empirical insights for calibrating the intensity of GEC to maximize incentives for firms to engage in sustainable practices. Full article

The wide application of artificial intelligence (AI) technology is reshaping the production methods and governance models of agricultural enterprises, laying a solid foundation for them to achieve sustainable development goals. This study examines 245 agricultural listed enterprises on China’s A-share market from 2012 to 2023 as the research sample and uses the double fixed effects model to investigate the impact and mechanism of AI technology on the sustainable development performance (SDP) of agricultural enterprises. Research has found that AI technology has significantly enhanced the SDP of agricultural enterprises. After tests for endogeneity and robustness, the conclusion remains valid. Mechanism tests show that AI technology can enhance the SDP of agricultural enterprises by promoting green innovation and improving the quality of internal control. Through the analysis of moderating effects, it is found that both the information technology background of senior executives and their green background can positively moderate the relationship between AI technology and the SDP of agricultural enterprises. Heterogeneity tests revealed that AI technology has a more significant effect on enhancing the SDP of non-state-owned, small and medium-sized, and processing and manufacturing agricultural enterprises, alongside those in regions with high environmental regulations. The research provides empirical evidence for AI empowering agricultural enterprises’ sustainable development and offers targeted actionable insights to advance agricultural modernization and green transformation. Full article

Growing global awareness of climate change and environmental protection has fueled the rapid expansion of the green bond market. Building upon a theoretical framework that links green bond issuance with corporate governance and green innovation effects, this study employs a sample of Chinese A-share listed firms from 2014 to 2022 and applies a staggered difference-in-differences (DID) approach to empirically examine the impact of green bond issuance on corporate risk-taking and the underlying mechanisms. The results indicate that green bond issuance significantly reduces firms’ risk-taking levels. This effect operates primarily through three channels: increasing agency costs, enhancing information transparency, and exacerbating structural imbalances in green innovation. Furthermore, the risk-mitigating effect of green bonds is more pronounced in state-owned enterprises, firms with low audit quality, and firms operating in heavily polluting industries. These findings offer important implications for accelerating the diversification of China’s green financial system, improving firms’ risk management capabilities, and fostering the development of green productivity. Full article

Financial statement fraud is a socio-technical risk that arises from coupled organizational, informational, and regulatory processes. To address the Identification Paradox in financial fraud detection, where existing models cannot simultaneously recognize both chronic manipulation and acute outbreaks in financial data, this study proposes the Causal–Temporal Asynchrony (CTA) theory as a process-oriented conceptual framework that guides feature construction and model design in a predictive setting. CTA defines fraud motive as a chronic, multi-period accumulation and fraud action as an acute, single-year event. To operationalize CTA within a predictive setting, we build a deployable Decoupling-Fusion System that encodes CTA as an Acute–Chronic Binary Feature Dimensions schema and performs detection via Decoupling-Fusion FraudNet. Within this system, parallel Long Short-Term Memory networks (LSTM) capture chronic motive signals from longitudinal sequences, while parallel Convolutional Neural Networks (CNN) and a Feed-forward Neural Network (FNN) identify acute action signals from multimodal snapshots; the resulting asynchronous probabilities are integrated via an adaptive decision-level fusion mechanism. Empirical tests on China’s A-share market (2001–2021) show the system (AUC = 0.967) outperforms baseline models. Furthermore, eXplainable AI analysis reveals patterns consistent with the classic fraud triangle (pressure, opportunity and rationalization). This study develops a theory-grounded decision-support system that unifies acute and chronic evidence streams and provides a deployable blueprint for continuous auditing and governance. Full article