The Impact of Environmental Regulations on Enterprises’ Green Innovation: The Mediating Effect of Managers’ Environmental Awareness

Deqin Lin and Yuetong Zhao ()
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Deqin Lin: Faculty of Finance, City University of Macau, Macau 999078, China
Yuetong Zhao: Institute for Research on Portuguese-Speaking Countries, City University of Macau, Macau 999078, China

Sustainability, 2023, vol. 15, issue 14, 1-26

Abstract: It is of great significance to clarify the impact and mechanism of environmental regulations on enterprises’ green innovation. This paper empirically studies the impact of command-and-control environmental regulation (CCER) and market-incentive-based environmental regulation (MBER) on enterprises’ green innovation and tests the mediating effect of managers’ environmental awareness by using the data of Chinese A-share companies listed in the Shanghai and Shenzhen stock exchange from 2011 to 2020. The results show the following: 1. the CCER has a significant promoting effect on both the quantity and quality of green innovation, but the impact of the MBER is significantly negative; 2. managers’ environmental awareness has a mediating effect on the impact of the CCER, but there is no such mediating effect on the impact of the MBER; 3. The CCER has a strong promoting effect on the quantity and quality of the green innovation of heavily polluting state-owned enterprises with a high innovation capacity in central cities, while the MBER has a significant negative impact on the green innovation capacity of heavily polluting non-state-owned enterprises but can significantly promote the quantity and quality of enterprises’ green innovation with a high innovation capacity located in central cities. Finally, this paper gives some suggestions to promote the green innovation capacity of enterprises by optimizing the design of environmental regulation tools, improving managers’ environmental awareness and enhancing the degree of marketization.

Keywords: environmental regulation; enterprises’ green innovation; mediating effect; heterogeneity; managers’ environmental awareness (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2023
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (6)

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