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The impact of directors’ green experience on corporate environmental performance: Evidence from machine learning-based news text analysis

Author

Listed:
  • Liu, Mengyuan
  • Chen, Gang
  • Wang, Qisong
  • Han, Yajie

Abstract

By employing machine learning algorithms and text analysis to measure corporate environmental performance using sentiment indicators derived from corporate environmental news text, this study investigates the impact of directors’ green experience on corporate environmental performance, based on data from Chinese A-share manufacturing listed firms from 2016 to 2023. The results indicate that directors’ green experience significantly enhances corporate environmental performance. The underlying mechanism is the promotion of both substantive and symbolic green innovation. External environmental regulatory distance and investor attention negatively and positively moderate this relationship, respectively. Heterogeneity tests reveal that the positive impact of directors’ environmental experience on corporate environmental performance is more pronounced in firms with high government subsidies and stringent environmental regulations, as well as in non-heavy-polluting and non-capital-intensive firms.

Suggested Citation

  • Liu, Mengyuan & Chen, Gang & Wang, Qisong & Han, Yajie, 2025. "The impact of directors’ green experience on corporate environmental performance: Evidence from machine learning-based news text analysis," Finance Research Letters, Elsevier, vol. 85(PC).
    • Handle: RePEc:eee:finlet:v:85:y:2025:i:pc:s1544612325012218
    DOI: 10.1016/j.frl.2025.107963
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    JEL classification:

    • C33 - Mathematical and Quantitative Methods - - Multiple or Simultaneous Equation Models; Multiple Variables - - - Models with Panel Data; Spatio-temporal Models
    • D21 - Microeconomics - - Production and Organizations - - - Firm Behavior: Theory
    • G34 - Financial Economics - - Corporate Finance and Governance - - - Mergers; Acquisitions; Restructuring; Corporate Governance
    • Q56 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environment and Development; Environment and Trade; Sustainability; Environmental Accounts and Accounting; Environmental Equity; Population Growth

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