Influence of government divestiture, secondary privatization, and regional development on corporate environmental...

This research delves into how government divestiture influences Corporate Environmental Performance (CEP) and explores the role of regional development in moderating this connection. Analyzing data from a sample of Chinese publicly traded companies between 2012 and 2023, we employ a fixed-effect model to conduct our analysis. The results highlight a negative impact of government divestiture on CEP. Moreover, our findings indicate that regional development can alleviate this adverse effect, suggesting that companies located in more developed regions are more likely to emphasize sustainability reporting, possibly due to heightened attention from stakeholders. To tackle potential issues of endogeneity, we apply propensity score matching (PSM), Heckman tests, and the generalized method of moments (GMM). These results offer valuable insights for policymakers, especially concerning the implications of privatization on sustainability initiatives in emerging markets like China.