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The impact of artificial intelligence on the green governance performance of enterprises

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  • Yu, Mengke
  • Sun, Qingyang
  • Huang, Hui

Abstract

Using data from 4235 Chinese firms over the period 2009–2022, this study investigates the impact of corporate artificial intelligence (AI) adoption on green governance performance and examines the underlying mechanisms. Our results demonstrate that the adoption of AI positively influences green governance performance, and this conclusion remains robust following a series of sensitivity tests. In terms of mechanisms, AI adoption enhances green governance performance by lowering green management costs and increasing green innovation outputs. A heterogeneity analysis reveals that AI's positive effect is more pronounced in traditional manufacturing firms, those located in eastern China, and those that target international markets. This study provides valuable insights into improving green governance performance and achieving high-quality green development in accordance with China's “dual carbon” goals. It also offers practical strategies for firms to use AI in reducing costs and strengthening their innovation capabilities in green governance.

Suggested Citation

  • Yu, Mengke & Sun, Qingyang & Huang, Hui, 2025. "The impact of artificial intelligence on the green governance performance of enterprises," International Review of Financial Analysis, Elsevier, vol. 106(C).
    • Handle: RePEc:eee:finana:v:106:y:2025:i:c:s1057521925006350
    DOI: 10.1016/j.irfa.2025.104548
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