IDEAS home Printed from https://ideas.repec.org/a/gam/jsusta/v17y2025i20p8998-d1768589.html

Mitigating Involutionary Competition Through Corporate ESG Adoption: Evidence from the Consumer Electronics Manufacturing Industry

Author

Listed:
  • Menghan Shao

    (School of Finance and Economics, Jiangsu University, No. 301, Xuefu Road, Jingkou District, Zhenjiang 212013, China)

  • Yue Liu

    (School of Finance and Economics, Jiangsu University, No. 301, Xuefu Road, Jingkou District, Zhenjiang 212013, China)

  • Guanbing Zhao

    (School of Finance and Economics, Jiangsu University, No. 301, Xuefu Road, Jingkou District, Zhenjiang 212013, China)

  • Haitao Sun

    (School of Finance and Economics, Jiangsu University, No. 301, Xuefu Road, Jingkou District, Zhenjiang 212013, China)

  • Peiyuan Zhao

    (College of Arts and Sciences, The Ohio State University, Columbus, OH 43210, USA)

Abstract

This study investigates whether and how corporate commitment to environmental, social and governance (ESG) performance can mitigate involutionary competition in China’s consumer electronics manufacturing industry. By constructing a quantifiable index of involutionary competition intensity and matching it with corporation-level ESG scores, we document a statistically significant negative association between ESG performance and the degree of involutionary competition. Mechanism analysis reveals that ESG mitigates involutionary competition through two primary channels: (1) differentiation strategies that reduce price-based competition and product homogeneity, and (2) market-order regulation that curbs opportunistic behaviour and raises R&D efficiency. A modest price increase is shown to be revenue-enhancing; moreover, random-forest simulations indicate that counter-involutionary competition efforts amplify the market-share gains from cooperative R&D expenditures, accelerating post-adjustment revenue growth. This transition generates simultaneous increases in corporate profits and corporation value, breaking the previous price ceiling and establishing a sustainable development loop. The findings provide actionable insights for shifting the industry from low-level rivalry to sustainable value creation.

Suggested Citation

  • Menghan Shao & Yue Liu & Guanbing Zhao & Haitao Sun & Peiyuan Zhao, 2025. "Mitigating Involutionary Competition Through Corporate ESG Adoption: Evidence from the Consumer Electronics Manufacturing Industry," Sustainability, MDPI, vol. 17(20), pages 1-37, October.
    • Handle: RePEc:gam:jsusta:v:17:y:2025:i:20:p:8998-:d:1768589
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/2071-1050/17/20/8998/pdf
    Download Restriction: no
    File URL: https://www.mdpi.com/2071-1050/17/20/8998/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Xinze Li & Xi Wang & Zuoxiang Zhao & Qiuyun Zhao, 2025. "ESG ratings, executive pay-for-performance sensitivity and within-firm pay gap," Humanities and Social Sciences Communications, Palgrave Macmillan, vol. 12(1), pages 1-10, December.
    2. Yating Ding & Xudong Wang & Lin Wu, 2025. "Environmental tax law and greenwashing: the moderating role of digitization," Humanities and Social Sciences Communications, Palgrave Macmillan, vol. 12(1), pages 1-15, December.
    3. Caixia Song & Wenyuan Ma, 2025. "ESG and green innovation: nonlinear moderation of public attention," Humanities and Social Sciences Communications, Palgrave Macmillan, vol. 12(1), pages 1-14, December.
    4. Wei Yang & Yurong Zhang, 2025. "Standardization catch-up strategy of latecomer enterprises: a longitudinal case of Huawei," Humanities and Social Sciences Communications, Palgrave Macmillan, vol. 12(1), pages 1-16, December.
    5. Ming Chen & Xin Tan & Jianhua Zhu & Rebecca Kechen Dong, 2025. "Can supply chain digital innovation policy improve the sustainable development performance of manufacturing companies?," Humanities and Social Sciences Communications, Palgrave Macmillan, vol. 12(1), pages 1-15, December.
    6. Xiaobo Zhuang & Yaoming Li, 2023. "Segmentation and Angle Calculation of Rice Lodging during Harvesting by a Combine Harvester," Agriculture, MDPI, vol. 13(7), pages 1-15, July.
    7. Wu, Ran, 2025. "Forecasting the European Union allowance price tail risk with the integrated deep belief and mixture density networks," Chaos, Solitons & Fractals, Elsevier, vol. 199(P2).
    8. Da Gao & Linfang Tan & Yue Chen, 2025. "Smarter is greener: can intelligent manufacturing improve enterprises’ ESG performance?," Humanities and Social Sciences Communications, Palgrave Macmillan, vol. 12(1), pages 1-12, December.
    9. Qiwen Dai & Ju He & Zhongyuan Guo & Yanqiao Zheng & Yue Zhang, 2025. "Green finance for sustainable development: analyzing the effects of green credit on high-polluting firms’ environmental performance," Humanities and Social Sciences Communications, Palgrave Macmillan, vol. 12(1), pages 1-13, December.
    10. Wei Liu & Han Yan, 2025. "The evaluation of ESG strategy implementation effect based on performance prism: evidence from the industrial and commercial bank of China," Humanities and Social Sciences Communications, Palgrave Macmillan, vol. 12(1), pages 1-14, December.
    11. Nathanael Ojong, 2022. "Energizing entrepreneurship," Nature Energy, Nature, vol. 7(5), pages 392-393, May.
    12. Huisu Lai & Lei Quan & Fei Wu & Song Tang & Chong Guo & Xiaobing Lai, 2025. "Corporate environmental publicity and green innovation: are words consistent with actions?," Humanities and Social Sciences Communications, Palgrave Macmillan, vol. 12(1), pages 1-14, December.
    13. Ming Chen & Xin Tan & Jianhua Zhu & Rebecca Kechen Dong, 2025. "Correction: Can supply chain digital innovation policy improve the sustainable development performance of manufacturing companies?," Humanities and Social Sciences Communications, Palgrave Macmillan, vol. 12(1), pages 1-1, December.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Ying Xong Thanongsack & Muhammad Kamil & Souvanhxay Paovangsa & Ke Xing, 2025. "The Effectiveness of Technology Transfer Within the China–Laos Economic Corridor on Industrial SME Performance: A Configurational Approach," SAGE Open, , vol. 15(4), pages 21582440251, December.
    2. Tao Wang & Yang Shen, 2025. "Unlocking the potential of supply chain digitalization for enhancing enterprise green transformation performance: evidence from China," Humanities and Social Sciences Communications, Palgrave Macmillan, vol. 12(1), pages 1-16, December.
    3. Talluri, Srinivas (Sri) & Yoon, Jiho & Park, Seayoung & Oh, Jaeyoung, 2025. "Resolving the digitalization–sustainability energy paradox: Small Modular Reactor (SMR)-enabled resilience in supply chains," Transportation Research Part E: Logistics and Transportation Review, Elsevier, vol. 202(C).
    4. Guo, Lixing & Kuang, Zengjie, 2025. "How does digitalization of the supply chain accelerate the sustainable development of listed companies in the new energy sector?," International Review of Economics & Finance, Elsevier, vol. 103(C).
    5. Liu, Wen & Miao, Zhenlong, 2025. "Can digital product innovation enhance corporate market competitiveness?," Finance Research Letters, Elsevier, vol. 86(PA).
    6. Yuqiong Zheng & Yue Peng & Wei Wang & Yunqiang Liu & Raymond Chiong, 2025. "Promotion or hindrance? Digital transformation of the supply chain and total factor productivity of midstream enterprises," Humanities and Social Sciences Communications, Palgrave Macmillan, vol. 12(1), pages 1-18, December.
    7. Haozhe Deng & Yafei Lan & Guangyao Chen & Yi Zheng & Maomao Zhang, 2025. "Sustainable Marketing Performance and Responsive Market Orientation of Enterprises in the Context of Digital Transformation: A Case Study of the Green Consumer-Goods Industry," Sustainability, MDPI, vol. 17(17), pages 1-29, September.
    8. Sun, Yemeng & Zhang, Xiaoxia & Dong, Zhuoqi, 2025. "The impact of top management team heterogeneity and financial misallocation on corporate resource allocation efficiency," International Review of Economics & Finance, Elsevier, vol. 103(C).
    9. Li, Xintian & Yong, Hui, 2025. "The impact of green finance on the environmental performance of industrial enterprises: The moderating role of digital transformation," Finance Research Letters, Elsevier, vol. 86(PG).
    10. Zhang, Xingyan & He, Yu, 2026. "Spatial impact of green finance reform and innovation pilot zones on industrial structure upgrading in China," Finance Research Letters, Elsevier, vol. 92(C).
    11. Abdulaziz Al Naim & Abdulrahman Alomair & Kaouther Chebbi, 2026. "The moderating effect of corporate governance reforms on the relationship between audit committee chair attributes and ESG disclosures," Humanities and Social Sciences Communications, Palgrave Macmillan, vol. 13(1), pages 1-21, December.
    12. Chen, Yuhang & Zhong, Yilin & Xu, Feng & Zhang, Qinghua, 2025. "Driving environmental, social, and governance excellence: The direct and indirect effects of intelligent transformation," Structural Change and Economic Dynamics, Elsevier, vol. 75(C), pages 313-331.
    13. Eren Erkılıç & Cengiz Gazeloğlu & Ece Özgören Ünlü, 2025. "Renewable Energy Solution to Carbon Emissions: BRICS Countries in the Grip of Globalization and Economic Growth," Sustainability, MDPI, vol. 17(9), pages 1-24, May.
    14. Sheng Tai & Zhong Tang & Bin Li & Shiguo Wang & Xiaohu Guo, 2025. "Cumin-Harvesting Mechanization of the Xinjiang Cotton–Cumin Intercropping System: Review of the Problem Status and Solutions," Agriculture, MDPI, vol. 15(8), pages 1-24, April.
    15. Zhao, Kai & Wang, Kun, 2026. "The hidden spillover effects behind the green curtain: government environmental concern and green technology innovation in manufacturing," Finance Research Letters, Elsevier, vol. 87(C).
    16. Ming Che Lee, 2025. "A Hybrid EGARCH–Informer Model with Consistent Risk Calibration for Volatility and CVaR Forecasting," Mathematics, MDPI, vol. 13(19), pages 1-22, September.
    17. Han, Zhen & Luo, Erga & Xiong, Xuezhen & Li, Jinkai, 2026. "Government innovation subsidies and enterprise digital transformation: Evidence from Chinese listed companies," Technology in Society, Elsevier, vol. 84(C).
    18. Kibiya Abubakar Yusuf & Edwin O. Amisi & Qishuo Ding & Xinxin Chen & Gaoming Xu & Abdulaziz Nuhu Jibril & Moussita G. Gedeon & Zakariya M. Abdulhamid, 2024. "Novel Technical Parameters-Based Classification of Harvesters Using Principal Component Analysis and Q-Type Cluster Model," Agriculture, MDPI, vol. 14(6), pages 1-16, June.
    19. Qian Zhang & Qingshan Chen & Wenjie Xu & Lizhang Xu & En Lu, 2024. "Prediction of Feed Quantity for Wheat Combine Harvester Based on Improved YOLOv5s and Weight of Single Wheat Plant without Stubble," Agriculture, MDPI, vol. 14(8), pages 1-29, July.
    20. Wei, Wenwan & Yang, Sini, 2025. "Study on the factors and paths of optimizing and upgrading the regional industrial structure: A hybrid analysis based on extended NCA and fsQCA," Economic Analysis and Policy, Elsevier, vol. 87(C), pages 2083-2102.

    More about this item

    Keywords

    ;
    ;
    ;
    ;
    ;

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:gam:jsusta:v:17:y:2025:i:20:p:8998-:d:1768589. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: MDPI Indexing Manager The email address of this maintainer does not seem to be valid anymore. Please ask MDPI Indexing Manager to update the entry or send us the correct address (email available below). General contact details of provider: https://www.mdpi.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.