Retail Investors’ Social Media Interaction and Corporate Green Innovation: Evidence from China Listed Companies in Heavily Polluting Industries

Green innovation, which promotes the coordinated development of the economy and ecology, serves as a critical means to achieve enterprises’ green transformation. Against the backdrop of the Internet era, retail investors, as an important supervisory group for enterprises, can generate online public opinion through interactive exchanges on social media platforms. This raises the question: Can such public opinion rooted in social media influence enterprises’ green innovation behaviors? To address this, this study uses data from Chinese A-share listed enterprises in heavily polluting industries on the Shanghai and Shenzhen Stock Exchanges from 2008–2021, comprising a total sample size of 8755, and employs ordinary least squares (OLS) regression models to empirically examine the relationship between retail investors’ social media interactions and enterprise green innovation. The findings reveal that interactive discussions by retail investors on social media significantly enhance enterprises’ green innovation levels. Mechanism tests show that social media interactions among these investors strengthen enterprises’ environmental awareness and alleviate their financing constraints, thereby promoting green innovation. Moderation effect tests indicate that the quality of social media information interaction and public opinion sentiment positively moderate the relationship between retail’s social media interactions and enterprise green innovation. Heterogeneity tests further show that the positive effect of retail’s social media interactions on enterprise green innovation is more pronounced in regions with stronger environmental information regulation and stronger investor protection. The conclusions of this study not only enrich research on the relationship between retail investors’ social media supervision and enterprises’ behavioral decision-making but also extend the literature on the influencing factors of enterprise green innovation from the perspective of public governance. These findings hold important implications for enterprises’ green transformation practices under the “double carbon” goals and provide valuable insights for corporate governance in the era of the digital economy.