Firm sustainable development and stakeholder engagement: The role of government support

This study examines the sustainable development of Chinese firms in the context of the government implementing environmental policies that support green initiatives, from a resource‐based perspective. Using a sample of Chinese listed firms in the most polluting industries during the period 2001–2015...

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Bibliographic Details
Published inBusiness strategy and the environment Vol. 27; no. 8; pp. 1145 - 1158
Main Authors Quan, Yi, Wu, Huiying, Li, Sihai, Ying, Sammy Xiaoyan
Format Journal Article
LanguageEnglish
Published Chichester Wiley Periodicals Inc 01.12.2018
Subjects
Bank loans
Banking
Companies
Economic analysis
Economic performance
Environmental impact
Environmental management
Environmental performance
Environmental policy
Government
government support
Impact analysis
Investments
Loans
Organizational performance
stakeholder engagement
Stakeholders
Sustainability
Sustainable development
Taxation
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Summary:This study examines the sustainable development of Chinese firms in the context of the government implementing environmental policies that support green initiatives, from a resource‐based perspective. Using a sample of Chinese listed firms in the most polluting industries during the period 2001–2015, we find a positive relationship between environmental performance and economic performance. We also find that government‐controlled resources, including bank loans and tax benefits, are the mechanisms through which the effects of environmental investments are transformed into economic gains. Further analyses show that the positive association between environmental and economic performance holds for state‐owned firms only. These results indicate that although “being green” is associated with improvements in firm performance, such a strategy benefits only those firms that receive preferential treatment from the government. This study reveals that the Chinese Government, as the most influential stakeholder, plays an important role in determining the impact of environmental performance on economic performance.
ISSN:0964-4733
1099-0836
DOI:10.1002/bse.2057