Are Enterprises Willing to Participate in Voluntary Environmental Regulation? A Theoretical Analysis and Empirical Test

Feng Pan, Yanni Xu and Lin Wang ()
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Feng Pan: School of Public Administration and Humanities and Arts, Dalian Maritime University, Dalian 116026, China
Yanni Xu: School of Public Administration and Humanities and Arts, Dalian Maritime University, Dalian 116026, China
Lin Wang: School of Economics and Management (Tourism), Dalian University, Dalian 116622, China

Sustainability, 2025, vol. 17, issue 4, 1-21

Abstract: Voluntary environmental regulation is characterized by its non-compulsory nature, which gives enterprises the right to make their own choices. The wide application and high prevalence of the ISO14001 standard in China make it a representative and typical standard that can effectively reflect the degree of voluntary participation of enterprises in environmental management. Therefore, this paper uses whether enterprises have obtained this certification as a proxy measure of whether they have participated in voluntary environmental regulation for model construction. Enterprises that choose to participate indicate that they have higher self-imposed limits on environmental protection and have invested significant resources in reducing pollution and emissions. In order to investigate the willingness of enterprises to participate, a four-party evolutionary game model of “central government–enterprises–investors–consumers” was developed for theoretical analysis, followed by an empirical test using a numerical simulation method, aiming at identifying the key factors influencing the voluntary participation of enterprises. The study found that the central government’s active implementation is a key factor in promoting the active participation of enterprises in voluntary environmental regulation; investors’ green investment and consumers’ concern also play an important role, but the influence of consumers’ concern is relatively small and has a partial substitution effect with investors’ green investment; increasing central government rewards and boosting the amount of green investment by investors will effectively increase the speed and motivation of enterprises to participate.

Keywords: voluntary environmental regulation; enterprise participation; the central government; four-party evolutionary game (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2025
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