Does Government’s Attention to Green Development Promote Enterprise Green Transition? Evidence from China

Shucheng Liu and Yilong Li

Emerging Markets Finance and Trade, 2025, vol. 61, issue 11, 3461-3481

Abstract: The Chinese government has played a crucial role in promoting the green development of enterprises and establishing a market-oriented green transition system. However, existing literature has largely overlooked the potential impact of government attention to green development (GAGD) on the green transition of micromarket entities. Using data from Chinese A-share listed companies from 2010 to 2023, this study examines the impact of the GAGD on enterprise green transition and explore. It also explores the underlying mechanisms from the perspectives of external formal systems and internal strategic responses. Findings indicate that GAGD significantly promotes enterprise green transition, and this conclusion remains robust after a series of endogeneity and robustness tests. Moreover, the positive effect of GAGD on enterprise green transition is more pronounced in the eastern region, heavy pollution industries, and state-owned enterprises. Mechanism analysis reveals that GAGD facilitates enterprise green transition through three key channels: strengthening regional environmental regulations, enhancing corporate social responsibility, and increasing corporate environmental investment. This study provides theoretical insights and policy implications for advancing enterprise green transition and high-quality economic development by leveraging the role of an effective government.

Date: 2025
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DOI: 10.1080/1540496X.2025.2486685

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