Impact Of Political Conenctions On Private Enterprise’s Environmental Performance

Environment protection is core concept of corporate socialresponsibility. Whether corporates show good performance onenvironment protection is concerned by different social sectors. ImprovingEnvironment performance relies on activities and resources inputting. Butthe problem of resources constraint often suppressed the motivation ofcorporates’ environment activities. Environment subsidy is a policyestablished by government to help corporations take steps on environmentand nature resources protection. This policy provides subsidies for firms toimprove their environment management, improve the production process.What are the factors influence the distribution of environmental subsidies,i.e. what kind of enterprise is more likely to get environmental subsidies?Do the corporate which get the subsidies improve its environmentperformance efficiently, i.e. does the subsidy really effective? Exploringthese answers is the main purpose of this paper’s study.Based on the literature review of corporation political connection andcorporation environment performance, and the theoretical model ofresource based view (RBV) and reputation theory, we established theresearch model. According to the analysis of274A-share market listedprivate manufacturing enterprises’ data (2008-2010), the empirical resultsshow that:1.Political connected enterprises are more likely to get theenvironment subsidies;2.The enterprises with environment subsidiesperform better on environment management;3. Political connection ofenterprises help to improve better environment performance through themediating effect of environment subsidies, i.e. the political connectedenterprise can obtain more environment subsidies from government, thus will show better environment performance.Contributions of this paper are:(1) the first to reveal the impact ofcorporation political connection on environment performance;(2) inspectthe relevance of corporation political connection with governmentenvironment subsidies;(3) from the view of enterprise environmentperformance check the efficiency of environment subsidies use;(4) findthe mediating effect of government subsidies between the relationship ofenterprise political connections and enterprise environment performance.