Informal institutions and corporate carbon emissions: Evidence from China’s listed companies

This research explores the connection between religious culture and carbon emissions through the lens of informal institutions, offering valuable insights into the shift to a green economy in China. The research sample comprises listed enterprises from 2010–2020 to investigate the influence of indigenous religious culture, represented by Buddhism and Taoism, on the corporate carbon footprint. The results reveal that religious culture has a notable inhibitory effect on corporate carbon outputs. Through a suite of robustness checks, the findings remain in line with the benchmark results. Heterogeneity analysis reveals that the effect of religious culture on corporate carbon emissions is more noticeable in economically thriving areas, state-owned companies, polluting-intensive companies, capital-intensive companies, and high-tech companies. Mechanistic tests suggest that religious culture mainly reduces corporate carbon emissions through three pathways: promoting corporate social responsibility, alleviating corporate financing constraints, and increasing corporate green innovation. Research has shown that both formal institutions and foreign cultural impacts weaken the beneficial impact of indigenous religious culture on corporate carbon reduction but do not eliminate its effect. This study provides practical guidelines and theoretical references for enterprises and policy-makers in addressing climate change and achieving sustainable development.