Internal Control and Enterprise Green Innovation

Abstract

Green innovation has become an important support to promote the strategic goals of peak carbon dioxide emission and high-quality economic development. This paper systematically examines whether internal control can effectively drive enterprise green innovation and achieve the “win–win” result of enterprise economic development and environmental protection. We found that internal control can significantly improve the green innovation level of enterprises, which is mainly reflected in the mandatory disclosure stage of internal control information and the other four elements of internal control, except the control environment. The mechanism test found that internal control can promote green innovation by reducing enterprise risks, alleviating agency conflicts, relieving financing constraints, and improving the rationality of innovation investment. The heterogeneity test found that the promotion effect of internal control on green innovation is more significant in large enterprises and private enterprises; internal control can effectively supervise the maintenance of relationship resources, and relationship resources positively regulate the promotion effect of internal control on green innovation; excessive executive power will weaken the internal control supervision and punishment of executives, and weaken the positive effect between internal control and green innovation; internal control can improve the utilization rate of government subsidies, and government subsidies positively regulate the positive effect of internal control on green innovation. The research conclusions enrich the market-oriented research on the driving factors of enterprise green innovation, and provide empirical evidence for enhancing the competitiveness of enterprise green innovation and achieving carbon neutrality.