Can Green Mergers And Acquisitions Improve The Sustainable Development Capacity Of Heavily Polluting Enterprises?

Environmental regulation has strengthened the transformation appeal of badly polluting enterprises with strong negative externalities.Realizing the reshaping innovation of business model through green M&A has become a strategic choice for enterprises to ensure the sustainable development capacity.Green M&A refers to mergers and acquisitions by badly polluting enterprises that can increase their resource utilization rate or make them quickly enter other environmentally friendly industries.According to the statistics compiled in this paper,the proportion of green mergers and acquisitions by badly polluting enterprises in all mergers and acquisitions has increased significantly since 2013,reaching 41%as of 2016.Therefore,with the intensification of environmental storms,green mergers and acquisitions has become an increasingly important topic.The existing literatures mostly focuses on the definition of green mergers and acquisitions,social responsibility,etc.,but whether green mergers and acquisitions can really improve the sustainable development ability of badly polluting enterprises and the role of them becomes a topic to be verified.This paper takes the data of M&A transactions by A-share listed badly polluting enterprises from 2008 to 2016 as samples to empirically test the path and realistic effect of green M&A on the sustainable development capacity of badly polluting enterprises,and the role of business model innovation.The sustainability ability is measured by the Van Horn model.The business model innovation is more complicated to measure,so the comprehensive score measurement is calculated with the Liszt five-level scale and principal component analysis.This paper empirically analyses through comparing M&A and non-green M&A sample groups to explore whether green M&A can significantly improve the sustainable development capacity of badly polluting enterprises.Moreover,this paper further analyzes the moderating effect of enterprise scale,R&D investment and the nature of the main enterprise on the impact of green M&A on business model innovation.Through theoretical analysis and empirical test,the paper draws the following conclusions:First,badly polluting enterprises can improve their sustainable development capacity through green mergers and acquisitions.Green mergers and acquisitions can provide legal basis for their operations and production activities.Heavy polluting enterprises can regain the psychological recognition and resource support of stakeholders through green mergers and acquisitions,while reducing the compliance punishment risks and losses of badly polluting enterprises.Second,business model innovation can significantly enhance the relationship between green M&A and sustainable development capacity.Badly polluting enterprises can significantly improve the quality of their business models through green mergers and acquisitions,while business model innovation provides sufficient transformational power for the sustainable development of badly polluting enterprises,and promotes the transformation of new and old kinetic energy.Third,the larger the scale of badly polluting enterprises are,the more difficult it is for them to reshape the business model through green mergers and acquisitions.The badly polluting enterprises with high R&D investment and state-owned enterprises are more likely to achieve business model innovation through green mergers and acquisitions.The conclusion of this study not only verifies the "Porter Hypothesis" of green management in the context of M&A,but also provides theoretical support for the green financial practice of badly polluting enterprisesAlthough there are many literatures on the sustainable development capacity,there are few academic researches on whether green mergers and acquisitions can significantly improve the sustainable development capacity of heavily polluting enterprises combined with their business model.The empirical research in this paper proves the incentive effect and application value of green mergers and acquisitions to the conversion of new and old kinetic energy by heavy polluting enterprises.Meanwhile,it finds that business model innovation plays an important role in promoting transformation and upgrading of enterprises.It provides actionable recommendations and measures for high quality and sustainable development policy to be carried out.