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ORIGINAL RESEARCH article

Front. Environ. Sci.
Sec. Environmental Economics and Management
Volume 12 - 2024 | doi: 10.3389/fenvs.2024.1489896
This article is part of the Research Topic Climate Risk and Green and Low-Carbon Transformation: Economic Impact and Policy Response View all 6 articles

Improving Corporate Profitability from the Inside Out with Environmental Performance: An Empirical Analysis Based on Chinese Listed Company Data

Provisionally accepted
静 胡 静 胡 *彦云 赵 彦云 赵 *
  • Renmin University of China, Beijing, China

The final, formatted version of the article will be published soon.

    This study uses data from listed companies in China from 2008 to 2021, constructs a comprehensive evaluation of corporate environmental performance from the perspective of internal efficiency and externalities based on the text analysis method, and analyzes the impact and mechanism of environmental performance on profitability. In addition, we find that improving environmental performance can significantly increase profitability, especially if the company tackles pollution at the source. Furthermore, the impact of environmental performance on profitability tends to be driven by external markets. Obtaining environmental certifications, awards, and green patents can provide positive feedback and significantly increase profitability. In addition, the mechanism analysis shows that environmental performance affects firm profitability by improving green technology innovation, reducing financing constraints and increasing operating income. Finally, the results of the heterogeneity analysis show that the profitability-enhancing effect of environmental performance is stronger in non-state-owned firms, in clean industries firms and in regions with carbon emission trading.

    Keywords: environmental performance, profitability, Green technology innovation, financing constraints, text analysis

    Received: 02 Sep 2024; Accepted: 31 Oct 2024.

    Copyright: © 2024 胡 and 赵. This is an open-access article distributed under the terms of the Creative Commons Attribution License (CC BY). The use, distribution or reproduction in other forums is permitted, provided the original author(s) or licensor are credited and that the original publication in this journal is cited, in accordance with accepted academic practice. No use, distribution or reproduction is permitted which does not comply with these terms.

    * Correspondence:
    静 胡, Renmin University of China, Beijing, China
    彦云 赵, Renmin University of China, Beijing, China

    Disclaimer: All claims expressed in this article are solely those of the authors and do not necessarily represent those of their affiliated organizations, or those of the publisher, the editors and the reviewers. Any product that may be evaluated in this article or claim that may be made by its manufacturer is not guaranteed or endorsed by the publisher.