Proceedings of the 3rd International Conference on Bigdata Blockchain and Economy Management, ICBBEM 2024, March 29–31, 2024, Wuhan, China

Research Article

Can China’s Government Well Coordinate Market Performance and Environmental Performance of Firms?

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  • @INPROCEEDINGS{10.4108/eai.29-3-2024.2347397,
        author={Yihui  Wu and Biqian  Zhou and Tiansen  Liu and Zhu  Yue},
        title={Can China’s Government Well Coordinate Market Performance and Environmental Performance of Firms?},
        proceedings={Proceedings of the 3rd International Conference on Bigdata Blockchain and Economy Management, ICBBEM 2024, March 29--31, 2024, Wuhan, China},
        publisher={EAI},
        proceedings_a={ICBBEM},
        year={2024},
        month={6},
        keywords={market performance; environmental performance; government involvement; state-owned share; china’s firms},
        doi={10.4108/eai.29-3-2024.2347397}
    }
    
  • Yihui Wu
    Biqian Zhou
    Tiansen Liu
    Zhu Yue
    Year: 2024
    Can China’s Government Well Coordinate Market Performance and Environmental Performance of Firms?
    ICBBEM
    EAI
    DOI: 10.4108/eai.29-3-2024.2347397
Yihui Wu1, Biqian Zhou1, Tiansen Liu1,*, Zhu Yue2
  • 1: Harbin Engineering University
  • 2: Heilongjiang University
*Contact email: tiansen0328@hrbeu.edu.cn

Abstract

The state-owned property of China’s firms and serious environmental issues suggest analyzing whether China’s government can well coordinate the relationship that firms’ market performance affects environmental performance. This paper designs R&D investment, corporate growth, and net profit rate to embody the profile of market performance. Based on 1609 listed firms, we analyze the key issue that as a kind of mandatory regulation, whether state-owned share can positively moderate the influence of market performance on environmental performance. Our empirical findings reveal the significantly positively influence of R&D investment on environmental performance. However, the indicators of net profit rate and corporate growth could not present such impact on environmental performance. In addition, heterogeneity test reveals that stronger state-owned share improves the impact of net profit rate and growth on environmental performance. It implies that mandatory regulation more positively influences environmental management of firms with more state-owned shares. Overall, this paper suggests China’s government to consolidate the role of mandatory regulation in environmental management.