Greening through top management team's environmental attention?

Area of Science:

• Business and Management
• Environmental Science
• Corporate Sustainability

Background:

• Green innovation integrates innovation-driven strategies with green development for sustainable business practices.
• Firms increasingly recognize the importance of sustainable development in their operational strategies.
• Understanding the internal drivers of green innovation is crucial for effective strategy formulation.

Purpose of the Study:

• To investigate the impact of top management team's (TMT) environmental attention on a firm's green innovation.
• To examine the moderating roles of executive environmental background, government subsidies, and CEO duality in this relationship.
• To provide empirical evidence on the internal mechanisms driving corporate green innovation.

Main Methods:

• Utilized micro-level data from China's A-share listed companies.
• Employed text analysis to quantify TMT's environmental attention.
• Applied a two-way fixed-effects model, including robustness tests like the Heckman model and placebo test.

Main Results:

• TMT's environmental attention positively correlates with and drives firm's green innovation.
• A positive executive environmental background strengthens the positive effect of TMT's environmental attention.
• The positive effect is not significant for firms receiving substantial government subsidies, suggesting potential information asymmetry.
• CEO duality weakens the positive influence of TMT's environmental attention on green innovation.

Conclusions:

• TMT's environmental attention is a significant internal driver for corporate green innovation.
• Tailoring strategies based on executive background and understanding the impact of government interactions is vital for promoting sustainable development.
• The findings offer a foundation for developing targeted sustainable development strategies within firms.