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Does local green governance promote corporate green innovation? A new perspective from green officials

Author

Listed:
  • Hong Xu

    (Shandong Normal University)

  • Kai Lin

    (Huazhong University of Science and Technology)

  • Hui Wang

    (Hunan University)

  • Weifen Lin

    (South China Agricultural University)

  • Longzheng Du

    (Guangzhou College of Technology and Business)

Abstract

Substantial evidence highlights a significant relationship between local officials and corporate development. Currently, an increasing number of officials with environmental backgrounds are assuming local leadership roles. Therefore, it is essential to systematically assess the impact of “green officials” on corporate green technology innovation. Using a staggered difference-in-differences (DID) method based on firm-level data from 2006 to 2021 in China, this study investigates whether green governance based on green officials stimulates corporate green innovation by examining the impact of green officials on corporate green innovation. The research findings include: (1) Compared to conventional officials, green officials can promote a 12.7% increase in green innovation of local companies. Moreover, this effect has dynamic sustainability. And with the increase of the duration of environmental protection experience of green officials, there is a continuous enhancement effect. (2) The heterogeneity analysis reveals that the positive impact of green officials on corporate green technology innovation is not influenced by corporate ownership. However, the effect is more pronounced in companies with higher social responsibility. Additionally, companies in regions with environmental pressures place greater emphasis on the development of green invention patents. (3) Mechanism analysis indicates that green officials promote green innovation by providing environmental subsidies for companies, promoting corporate environmental investment, and attracting external green investors. These findings provide insights into how local officials can achieve green governance, promote corporate green innovation, and facilitate regional green development.

Suggested Citation

  • Hong Xu & Kai Lin & Hui Wang & Weifen Lin & Longzheng Du, 2025. "Does local green governance promote corporate green innovation? A new perspective from green officials," Empirical Economics, Springer, vol. 68(4), pages 1861-1892, April.
    • Handle: RePEc:spr:empeco:v:68:y:2025:i:4:d:10.1007_s00181-024-02682-0
    DOI: 10.1007/s00181-024-02682-0
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