How High-polluting Firms Suffer from Being Distracted form Intended Purpose: A Corporate Social Responsibility Perspective

Xue-Zhou Zhao, Jun Chen, Fengwen Chen, Wei Wang, Senmao Xia

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Abstract

High-polluting industries are regarded as the main sources of air pollutant emissions and the major factors that significantly destroy the ecological environment. Corporate innovation in high-polluting industries improves the energy consumption efficiency and reduces the emission of air pollutant, which mitigates the conflict between environment and economy. Using the sample of China’s listed firms from 2010 to 2017, this study examines the impact of corporate social responsibility (CSR) and financialization on corporate innovation in high-polluting industries. The results show that there is a positive association between CSR and corporate innovation, while there is a negative association between financialization and corporate innovation. Furthermore, the financialization of high-polluting firms can alleviate the promotion role of CSR in the innovation process. The financialization of state-owned enterprises in high-polluting industries may not have a crowding-out effect on research and development (R&D), but it can limit the R&D promotion effect of CSR engagements. In contrast, the financialization of non-state-owned enterprises will hinder corporate innovation, but it will not affect the association between CSR and technology innovation. We also find that the financialization of high-polluting firms with low financial constraints can alleviate the promotion role of CSR engagements in innovation. Meanwhile, the CSR engagements of high-polluting firms with high financial constraints play a stronger role in corporate innovation. During the implementation of environmental policies, the negative association between financialization and corporate innovation has been strengthened. Our findings can encourage high-polluting firms to make more efforts in environmental protection and social stability.

Original languageEnglish
Article number9197
Pages (from-to)1-29
Number of pages29
JournalInternational Journal of Environmental Research and Public Health
Volume17
Issue number24
DOIs
Publication statusPublished - 9 Dec 2020

Bibliographical note

This is an open access article distributed under the Creative Commons Attribution License which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.

Keywords

  • corporate innovation
  • corporate social responsibility
  • financialization
  • high-polluting industries
  • environmental protection
  • Corporate innovation
  • Corporate social responsibility
  • Financialization
  • High-polluting industries
  • Environmental protection

ASJC Scopus subject areas

  • Public Health, Environmental and Occupational Health
  • Health, Toxicology and Mutagenesis

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