Research On The Correlation Between Environmental Performance And Financial Performance In Heavy-polluted Industry

As the world's second-largest economic power,China's remarkable economic progress comes with increasingly prominent environmental issues.Environmental pollution affects the process of sustainable development in our country,curbs the production of economic results,damages people's physical health and affects social stability.Although people begin to form environmental protection concepts,there are still many companies blindly pursuing their own economic interests with environmental pollution,which is obviously contrary to the concept of sustainable development.The research on the relationship between environmental performance and financial performance has not reached to a unified conclusion yet.People always debate on whether the financial performance and environmental performance can reconcile.Taking heavy-polluted firms as research sample,to test the relationship between them is meaningful both theoretically and practicallyFirstly,this article collects and collates relevant literature on the relationship between environmental performance and financial performance,and then summarizes the existing research results of the relationship between the two to two parts-theoretical research results and empirical research.Secondly,on the basis of theoretical analysis,this paper proposes three hypotheses,including the relationship between environmental performance and financial performance in heavy-polluted industries and the differences between the in companies of different sizes and regions.Finally,through empirical tests,the following conclusions are obtained:(1)Environmental performance and financial performance of heavy-polluted industry are positively correlated;(2)Compared with small-size firms,the relationship of them is more positive in large firms.(3)Compared with firms in developing areas,the relationship is more pronounced in developed areas.Based on the research results,I suggest that companies should incorporate environmental protection into corporate management,since environmental performance is positively related to financial performance.The government should also regulate the behavior of companies through laws,regulations,and policies.At the same time,company size and regional differences should be considered to guide and drive the coordinated development of environmental performance and financial performance.