Downloads

https://doi.org/10.62836/iaet.v2i1.180
Lei, J., & Nisar, A. . (2023). Investigating the Influence of Green Technology Innovations on Energy Consumption and Corporate Value: Empirical Evidence from Chemical Industries of China. Innovations in Applied Engineering and Technology, 2(1), 1–16. https://doi.org/10.62836/iaet.v2i1.180
Volume 2, Issue 1

Investigating the Influence of Green Technology Innovations on Energy Consumption and Corporate Value: Empirical Evidence from Chemical Industries of China

This study investigates the impact of green technology innovation on energy consumption and corporate value in China's chemical industries, utilizing data from 133 A-share listed enterprises over the period of 2013-2022. Data on green technology innovation are sourced from the Chinese Research Data Services (CNRDS) Platform, while energy consumption data are obtained from listed companies' annual reports, social responsibility reports, and websites. Corporate ESG data is sourced from Huazheng ESG rating, and other data are obtained from China Stock Market & Accounting Research Database (CSMAR) and the National Statistics Bureau. Employing a two-way fixed effects model, this finds that green technology innovation mitigates energy consumption, and boosts corporate value of Chinese A-share listed enterprises of chemical industries. The study ensures the robustness of its findings through 2SLS analysis, using green patent applications as instrumental variables. The moderating effects of ESG disclosure are found significant to strengthen the influence of green technology innovation on energy consumption and corporate value. These findings offer valuable insights for policymakers and stakeholders in shaping strategies to promote sustainability and competitiveness in the chemical industry.

green technology innovation; energy consumption; corporate value; ESG disclosure; chemical industries

References

  1. Jiang Y, Tian S, Xu Z, Gao L, Xiao L, Chen S, Xu K, Chang J, Luo Z, Shi Z. Decoupling Environmental Impact from Economic Growth to Achieve Sustainable Development Goals in China. Journal of Environmental Management 2022; 312: 114978.
  2. Li Y, Mei Y, Zhang T, Xie Y. Paths to Carbon Neutrality in China’S Chemical Industry. Frontiers in Environmental Science 2022; 10: 999152.
  3. Power A. ADB Loans a Whopping $100m for Energy Efficiency Project in China. Asian Development Bank Grants. Available online: https://asian–power.com/project/news/adb–loans–whopping–100m–energy–efficiency–project–in–china#:~:text=The%20project%20will%20incorporate%20the%20first%20large%2Dscale,of%20China%20that%20will%20reduce%20harmful%20emissions (accessed on 10 February 2023).
  4. Braun E, Wield D. Regulation as a Means for the Social Control of Technology. Technology Analysis & Strategic Management 1994; 6(3): 259–272.
  5. Guo Y, Xia X, Zhang S, Zhang D. Environmental Regulation, Government R&D Funding and Green Technology Innovation: Evidence from China Provincial Data. Sustainability 2018; 10(4): 940.
  6. Zhao X, Sun B. The Influence of Chinese Environmental Regulation on Corporation Innovation and Competitiveness. Journal of Cleaner Production 2016; 112: 1528–1536.
  7. Xie X, Huo J, Qi G, Zhu KX. Green Process Innovation and Financial Performance in Emerging Economies: Moderating Effects of Absorptive Capacity and Green Subsidies. IEEE Transactions on Engineering Management 2015; 63(1): 101–112.
  8. Deng X, Oda S, Kawano Y. Graphene–Based Midinfrared Photodetector with Bull’S Eye Plasmonic Antenna. Optical Engineering 2023; 62(9): 097102–097102.
  9. Deng X, Oda S, Kawano Y. Split–Joint Bull's Eye Structure with Aperture Optimization for Multi–Frequency Terahertz Plasmonic Antennas. In Proceedings of the 2016 41st International Conference on Infrared, Millimeter, and Terahertz Waves (IRMMW–THz), Copenhagen, Denmark, 25–30 September 2016.
  10. Sukharev OS. Structural Analysis of Income and Risk Dynamics in Models of Economic Growth. Quantitative Finance and Economics 2020; 4(1): 1–18.
  11. Gorelick J, Walmsley N. The Greening of Municipal Infrastructure Investments: Technical Assistance, Instruments, and City Champions. Green Finance 2020; 2(2): 114–134.
  12. Deng X, Simanullang M, Kawano Y. Ge–Core/a–Si–Shell Nanowire–Based Field–Effect Transistor for Sensitive Terahertz Detection. Photonics 2018; 5(2): 13.
  13. Deng X, Kawano Y. Surface Plasmon Polariton Graphene Midinfrared Photodetector with Multifrequency Resonance. Journal of Nanophotonics 2018; 12(2): 026017–026017.
  14. Li Z, Liao G, Wang Z, Huang Z. Green Loan and Subsidy for Promoting Clean Production Innovation. Journal of Cleaner Production 2018 187; 421–431.
  15. Zhou ZF. On Evaluation Model of Green Technology Innovation Capability of Pulp and Paper Enterprise Based on Support Vector Machines. Advanced Materials Research 2014; 886: 285–288.
  16. Li J, Wei W, Zhen W, Guo Y, Chen B. How Green Transition of Energy System Impacts China's Mercury Emissions. Earth's Future 2019; 7(12): 1407–1416.
  17. Tang M, Walsh G, Lerner D, Fitza MA, Li Q. Green Innovation, Managerial Concern and Firm Performance: An Empirical Study. Business Strategy and the Environment 2018; 27(1): 39–51.
  18. Yin J, Gong L, Wang S. Large–Scale Assessment of Global Green Innovation Research Trends from 1981 to 2016: A Bibliometric Study. Journal of Cleaner Production 2018; 197: 827–841.
  19. Arenhardt DL, Battistella LF, Grohmann MZ. The Influence of the Green Innovation in the Search of Competitive Advantage of Enterprises of the Electrical and Electronic Brazilian Sectors. International Journal of Innovation Management 2016; 20(01): 1650004.
  20. Walley N, Whitehead B. It's Not Easy Bein' Green. Reader in Business and the Environment 1994; 36(81): 4.
  21. Palmer K, Oates WE, Portney PR. Tightening Environmental Standards: the Benefit–Cost or the No–Cost Paradigm?. Journal of Economic Perspectives 1995; 9(4): 119–132.
  22. Weng H–H, Chen J–S, Chen P–C. Effects of Green Innovation on Environmental and Corporate Performance: A Stakeholder Perspective. Sustainability 2015; 7(5): 4997–5026.
  23. Studer S, Welford R, Hills P. Engaging Hong Kong Businesses in Environmental Change: Drivers and Barriers. Business Strategy and the Environment 2006; 15(6): 416–431,.
  24. Min S, Mentzer JT. Developing and Measuring Supply Chain Management Concepts. Journal of Business Logistics 2004; 25(1): 63–99.
  25. Xu J, Li X, Choe S. The Effect of Green Innovation on Corporate ESG Performance: Evidence from Chinese Listed Enterprises. Asia–Pacific Journal of Business 2022; 13(1): 1–17.
  26. Wong WC, Batten JA, Mohamed–Arshad SB, Nordin S, Adzis AA. Does ESG Certification Add Firm Value?. Finance Research Letters 2021; 39: 101593.
  27. Broadstock DC, Chan K, Cheng LT, Wang X. The Role of ESG Performance During Times of Financial Crisis: Evidence from COVID–19 in China. Finance Research Letters 2021; 38: 101716.
  28. Aouadi A, Marsat S. Do ESG Controversies Matter for Firm Value? Evidence from International Data. Journal of Business Ethics 2018; 151: 1027–1047.
  29. Ghoul SE, Guedhami O, Kim Y. Country–Level Institutions, Firm Value, and the Role of Corporate Social Responsibility Initiatives. Journal of International Business Studies 2017; 48: 360–385.
  30. Eccles RG, Serafeim G, Krzus MP. Market Interest in Nonfinancial Information. Journal of Applied Corporate Finance 2011; 23(4): 113–127.
  31. Madsen PM, Rodgers ZJ. Looking Good by Doing Good: The Antecedents and Consequences of Stakeholder Attention to Corporate Disaster Relief. Strategic Management Journal 2015; 36(5): 776–794,.
  32. Garay L, Font X. Doing Good to Do Well? Corporate Social Responsibility Reasons, Practices and Impacts in Small and Medium Accommodation Enterprises. International Journal of Hospitality Management 2012; 31(2): 329–337.
  33. Cho CH, Patten DM, Roberts RW. Corporate Political Strategy: An Examination of the Relation Between Political Expenditures, Environmental Performance, and Environmental Disclosure. Journal of Business Ethics 2006; 67: 139–154.
  34. Tõnurist P. Framework for Analysing the Role of State Owned Enterprises in Innovation Policy Management: The Case of Energy Technologies and Eesti Energia. Technovation 2015; 38: 1–14.
  35. Lindman Å, Söderholm P. Wind Energy and Green Economy in Europe: Measuring Policy–Induced Innovation Using Patent Data. Applied energy 2016; 179: 1351–1359.
  36. Lee S–H, Park S, Kim T. Review on Investment Direction of Green Technology R&D in Korea. Renewable and Sustainable Energy Reviews 2015; 50: 186–193,.
  37. Diaz–Rainey I, Ashton JK. Investment Inefficiency and the Adoption of Eco–Innovations: The Case of Household Energy Efficiency Technologies. Energy Policy 2015; 82: 105–117.
  38. Miao C, Fang D, Sun L, Luo Q. Natural Resources Utilization Efficiency Under the Influence of Green Technological Innovation. Resources, Conservation and Recycling 2017; 126: 153–161.
  39. Zhu L, Luo J, Dong Q, Zhao Y, Wang Y, Wang Y. Green Technology Innovation Efficiency of Energy–Intensive Industries in China from the Perspective of Shared Resources: Dynamic Change and Improvement Path. Technological Forecasting and Social Change 2021; 170: 120890.
  40. Peck P, Parker T. The ‘Sustainable Energy Concept’–Making Sense of Norms and Co–Evolution Within a Large Research Facility's Energy Strategy. Journal of Cleaner Production 2016; 123: 137–154.
  41. Rosen MA. Assessing Global Resource Utilization Efficiency in the Industrial Sector. Science of the Total Environment 2013; 461: 804–807.
  42. Sonnenschein J, Mundaca L. Decarbonization Under Green Growth Strategies? The Case of South Korea. Journal of Cleaner Production 2016; 123: 180–193.
  43. Hyard A. Non–Technological Innovations for Sustainable Transport. Technological Forecasting and Social Change 2013; 80(7): 1375–1386.
  44. Gosens J, Lu Y. From Lagging to Leading? Technological Innovation Systems in Emerging Economies and the Case of Chinese Wind Power. Energy Policy 2013; 60: 234–250.
  45. M. D. Amore and M. Bennedsen. Corporate Governance and Green Innovation. Journal of Environmental Economics and Management 2016; 75: 54–72.
  46. Bi K, Huang P, Wang X. Innovation Performance and Influencing Factors of Low–Carbon Technological Innovation Under the Global Value Chain: A Case of Chinese Manufacturing Industry. Technological Forecasting and Social Change 2016; 111: 275–284.
  47. Albort–Morant G, Leal–Millán A, Cepeda–Carrión G. The Antecedents of Green Innovation Performance: A Model of Learning and Capabilities. Journal of Business Research 2016; 69(11): 4912–4917.
  48. Palmer M, Truong Y. The Impact of Technological Green New Product Introductions on Firm Profitability. Ecological Economics 2017; 136: 86–93.
  49. Fernando Y, Wah WX. The Impact of Eco–Innovation Drivers on Environmental Performance: Empirical Results from the Green Technology Sector in Malaysia. Sustainable Production and Consumption 2017; 12: 27–43.
  50. Purchase S, Kum C, Olaru D. Paths, Events and Resource Use: New Developments in Understanding Innovation Processes. Industrial Marketing Management 2016; 58: 123–136.
  51. Van Leeuwen G, Mohnen P. Revisiting the Porter Hypothesis: an Empirical Analysis of Green Innovation for the Netherlands. Economics of Innovation and New Technology 2017; 26(1–2): 63–77.
  52. Chen Q, Goldstein I, Jiang W. Price Informativeness and Investment Sensitivity to Stock Price. The Review of Financial Studies 2007; 20(3): 619–650.
  53. Cao H, Chen Z. The Driving Effect of Internal and External Environment on Green Innovation Strategy–The Moderating Role of Top Management’s Environmental Awareness. Nankai Business Review International 2019; 10(3): 342–361.
  54. Ai H, Hu S, Li K, Shao S. Environmental Regulation, Total Factor Productivity, and Enterprise Duration: Evidence from China. Business Strategy and the Environment 2020; 29(6): 2284–2296.
  55. Fang Z, Kong X, Sensoy A, Cui X, Cheng F. Government’s Awareness of Environmental Protection and Corporate Green Innovation: A Natural Experiment from the New Environmental Protection Law in China. Economic Analysis and Policy 2021; 70: 294–312.
  56. Shen C, Li S, Wang X, Liao Z. The Effect of Environmental Policy Tools on Regional Green Innovation: Evidence from China. Journal of Cleaner Production 2020; 254: 120122.
  57. Xiang X, Liu C, Yang M, Zhao X. Confession or Justification: The Effects of Environmental Disclosure on Corporate Green Innovation in China. Corporate Social Responsibility and Environmental Management 2020; 27(6): 2735–2750.
  58. Gürlek M, Tuna M. Reinforcing Competitive Advantage Through Green Organizational Culture and Green Innovation. The Service Industries Journal 2018; 38(7–8): 467–491.
  59. Yuan R, Li C, N. Li, Khan MA, Sun X, Khaliq N. Can Mixed–Ownership Reform Drive the Green Transformation of SOEs?. Energieds 2021; 14(10): 2964.
  60. Singh SK, Del Giudice M, Chierici R, Graziano D. Green Innovation and Environmental Performance: The Role of Green Transformational Leadership and Green Human Resource Management. Technological Forecasting and Social Change 2020; 150: 119762.
  61. Li F, Xu X, Li Z, Du P, Ye J. Can Low–Carbon Technological Innovation Truly Improve Enterprise Performance? The Case of Chinese Manufacturing Companies. Journal of Cleaner Production 2021; 293: 125949.
  62. Adegbile A, Sarpong D, Meissner D. Strategic Foresight for Innovation Management: A Review and Research Agenda. International Journal of Innovation and Technology Management 2017; 14(04): 1750019.
  63. Zhang Y, Xing C, Wang Y. Does Green Innovation Mitigate Financing Constraints? Evidence from China’s Private Enterprises. Journal of Cleaner Production 2020; 264: 121698.
  64. Yang L–R, Chen J–H, Li H–H. Validating a Model for Assessing the Association Among Green Innovation, Project Success and Firm Benefit. Quality & Quantity 2016; 50: 885–899.
  65. Rexhäuser S, Rammer C. Environmental Innovations and Firm Profitability: Unmasking the Porter Hypothesis. Environmental and Resource Economics 2014; 57: 145–167.
  66. Machmuddah Z, Sari DW, Utomo SD. Corporate Social Responsibility, Profitability and Firm Value: Evidence from Indonesia. The Journal of Asian Finance, Economics and Business 2020; 7(9): 631–638.
  67. Qureshi MA, Kirkerud S, Theresa K, Ahsan T. The Impact of Sustainability (Environmental, Social, and Governance) Disclosure and Board Diversity on Firm Value: The Moderating Role of Industry Sensitivity. Business Strategy and the Environment 2020; 29(3): 1199–1214.
  68. Soedjatmiko S, Tjahjadi B, Soewarno N. Do Environmental Performance and Environmental Management Have a Direct Effect on Firm Value?. The Journal of Asian Finance, Economics and Business 2021; 8(1): 687–696.
  69. Yao Q, Liu J, Sheng S, Fang H. Does Eco–Innovation Lift Firm Value? The Contingent Role of Institutions in Emerging Markets. Journal of Business & Industrial Marketing 2019; 34(8): 1763–1778.
  70. Crifo P, Forget VD, Teyssier S. The Price of Environmental, Social and Governance Practice Disclosure: An Experiment with Professional Private Equity Investors. Journal of Corporate Finance 2015; 30: 168–194.
  71. Alsayegh MF, Abdul Rahman R, Homayoun S. Corporate Economic, Environmental, and Social Sustainability Performance Transformation Through ESG Disclosure. Sustainability 2020; 12(9): 3910.
  72. Song M, Peng L, Shang Y, Zhao X. Green Technology Progress and Total Factor Productivity of Resource–Based Enterprises: A Perspective of Technical Compensation of Environmental Regulation. Technological Forecasting and Social Change 2022; 174: 121276.
  73. Blacconiere WG, Patten DM. Environmental Disclosures, Regulatory Costs, and Changes in Firm Value. Journal of Accounting and Economics 1994; 18(3): 357–377.
  74. Richardson AJ, Welker M. Social Disclosure, Financial Disclosure and the Cost of Equity Capital. Accounting, Organizations and Society 2001; 26(7–8): 597–616.
  75. Aerts W, Cormier D, Magnan M. Corporate Environmental Disclosure, Financial Markets and the Media: An International Perspective. Ecological Economics 2008; 64(3): 643–659.
  76. Schuler DA, Cording M. A Corporate Social Performance–Corporate Financial Performance Behavioral Model for Consumers. Academy of Management Review 2006; 31(3): 540–558.
  77. Xu J, Cui J. Green Technology Innovation in Low Carbon Cities and Enterprises. China Ind. Econ 2020; 12: 178–196.
  78. Wang S. Research on the Impact of Green Credit Policy on Green Technology Innovation of Listed Enterprises in Strategic Emerging Industries. Frontiers in Business, Economics and Management 2023; 11(3): 175–182.
  79. Fengzhan Q. Energy Consumption and Carbon Emission Reduction Potential of Silk Reeling Enterprises Under the Dual Carbon Background. Applied Energy Technology, 2022; 300(12): 39–45.
  80. M. Wang, Y. Li, and G. Liao. Research on the Impact of Green Technology Innovation on Energy Total Factor Productivity, Based on Provincial Data of China. Frontiers in Environmental Science 2021; 9: 710931.
  81. Hao X, Chen F, Chen Z. Does Green Innovation Increase Enterprise Value?. Business Strategy and the Environment 2022; 31(3): 1232–1247.
  82. Cho JH, Sohn SY. A Novel Decomposition Analysis of Green Patent Applications for the Evaluation of R&D Efforts to Reduce CO2 Emissions from Fossil Fuel Energy Consumption. Journal of Cleaner Production 2018; 193: 290–299.
  83. Herzer D. The Impact of Domestic and Foreign Public Green R&D on Domestic Green Innovation. Economics of Innovation and New Technology 2023; 1–21. DOI: 10.1080/10438599.2023.2300066.

Supporting Agencies

  1. Funding: Not applicable.