Environmental Regulation Reform And Corporate Green Innovation

Green technology innovation is an inherent requirement for China’s ecological civilization construction and green development.However,due to the typical dual externality characteristics of green innovation,relying solely on market forces often leads to insufficient green innovation incentives for enterprises.Environmental regulation theory holds that appropriate environmental regulation can largely address externalities and correct market failures,making it an important tool and means for guiding corporate green behavior.Currently,China has formed a diverse environmental regulatory system with policy coordination in command and control,market incentive,public participation,and voluntary approaches.It is undeniable that the comprehensive application of regulatory measures in various fields such as administration,economy,and legislation has played a positive role in improving environmental pollution and promoting green development.However,some studies have pointed out that China’s predominantly command and control-based environmental regulatory system suffers from problems such as high enforcement costs,excessive administrative intervention,and a lack of dynamic adjustment during the execution process,which is not conducive to sustained improvement in economic efficiency.Therefore,many scholars believe that compared with the increasing environmental regulatory efforts,the effectiveness of China’s environmental regulation has not met expectations and may even have negative effects.In this context,the Chinese government has been actively seeking to promote environmental regulatory reforms to strengthen the effectiveness of environmental regulation and address regulatory failures.What is the impact of China’s current environmental regulatory reform measures on corporate green innovation? How strong is their impact? Furthermore,this article focuses on exploring the transmission effect of environmental regulatory reform on corporate green innovation from the perspective of financing constraints.The answers to these questions undoubtedly have important practical significance for promoting the improvement of China’s environmental regulatory system and promoting the green transformation and development of the economy.To this end,based on China’s national conditions,this article regards the reform of the listed environmental verification system implemented by the former Ministry of Environmental Protection in 2014 as a quasi-natural experiment of environmental regulatory reform.Drawing on stakeholder theory,information theory,environmental risk management theory,and Porter’s hypothesis,and combining the policy background of the reform of the listed environmental verification system,this article focuses on analyzing and summarizing the effects and transmission mechanisms of the reform on the green technological innovation from the perspective of financing constraints.Subsequently,using the data of A-share listed companies in China from 2009 to 2020 and methods such as difference-in-differences,the above analysis was empirically tested.The research results show that:(1)the reform of the listed environmental verification system significantly promotes the level of green innovation of enterprises,and its promotion effect has a certain time lag,and this finding still holds after a series of robustness tests such as controlling for pairwise bias,replacing the explanatory variables,and changing the estimation method.(2)The reform of the listed environmental verification system can alleviate the financing constraints faced by enterprises,which in turn can promote the improvement of their green innovation level.Heterogeneity analysis shows that the reform of the listed environmental verification system is more able to alleviate the financing constraints of state-owned enterprises and large enterprises,while the promotion effect of the easing of financing constraints of private enterprises and large enterprises on corporate green innovation is more obvious.(3)The reform of the listed environmental protection verification system can alleviate the endogenous financing and equity financing constraints of enterprises,adjust to reduce the scale of corporate debt financing,and further positively regulate the impact effects of different financing channels on corporate green innovation and promote the enhancement of corporate green innovation.(4)Expanded analysis shows that the reform of the listed environmental verification system can improve firms’ financial performance,but the improvement effect on environmental performance is not significant.In addition,the reform of the listed environmental verification system does not have a crowding-out effect on other innovation and investment activities while promoting green innovation.