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The Effect of Environmental Regulation on Corporate Environmental Governance Behavior and Its Mechanisms

Author

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  • Di Zhu

    (School of Economics and Management, Henan Agricultural University, Ping An Avenue 218, Zhengzhou 450000, China)

  • Chang Liu

    (School of Economics and Management, Henan Agricultural University, Ping An Avenue 218, Zhengzhou 450000, China)

  • Yong Dong

    (School of Economics and Management, Henan Agricultural University, Ping An Avenue 218, Zhengzhou 450000, China)

  • Junguo Hua

    (School of Economics and Management, Henan Agricultural University, Ping An Avenue 218, Zhengzhou 450000, China)

Abstract

Environmental regulation is an institutional guarantee for achieving green and sustainable economic development, and the implementation effect of environmental regulation policies is a concern for all sectors of society. This paper empirically examines the impact of environmental regulation on firms’ environmental governance behavior using a double difference model with the help of a quasi-natural experiment, the new Environmental Protection Law, and analyzes the mediating effect of central environmental protection inspectors using data from listed companies in China from 2011 to 2020. It was found that environmental regulation significantly enhances firms’ motivation to participate in environmental governance and central environmental protection inspectors play a mediating role in the impact of environmental regulation on firms’ environmental governance behavior. Furthermore, heterogeneity analysis shows that the enhancement effect of environmental regulation on firms’ environmental governance behavior mainly exists in large-scale firms and nonstate enterprises.

Suggested Citation

  • Di Zhu & Chang Liu & Yong Dong & Junguo Hua, 2022. "The Effect of Environmental Regulation on Corporate Environmental Governance Behavior and Its Mechanisms," Sustainability, MDPI, vol. 14(15), pages 1-18, July.
    • Handle: RePEc:gam:jsusta:v:14:y:2022:i:15:p:9050-:d:870078
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    References listed on IDEAS

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    Cited by:

    1. Dandan Zhu & Xinping Tao & Meibo Huang, 2023. "Law Reinforcement, Production Pattern and Enterprise Environmental Performance: Evidence from Environmental Courts in China," Sustainability, MDPI, vol. 15(5), pages 1-20, March.
    2. Yong Ma & Chunyu Li, 2023. "Optimal Strategies of Customization and Information Sharing in the Presence of Feature Creep," Sustainability, MDPI, vol. 15(10), pages 1-29, May.
    3. Razzaq, Asif & Sharif, Arshian & Ozturk, Ilhan & Yang, Xiaodong, 2023. "Central inspections of environmental protection and transition for low-carbon Chinese cities: Policy intervention and mechanism analysis," Energy Economics, Elsevier, vol. 124(C).

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