Abstract
Technology innovation has become the main driving force of China’s economic growth. Sustainable development highlights the harmonious symbiosis of the economy and the ecological environment. Renewable energy companies characterized by technology-intensive and environmental friendliness are playing an increasingly important role in achieving economic development while alleviating environmental pressure. Therefore, this paper selects the A-share renewable energy listed companies in China between 2014 and 2019 as samples, using the fixed-effect model and the logit model to explore the effect of technology innovation on corporate sustainability. We find that technology innovation has a positive effect on both financial sustainability (FS) and social and environmental sustainability (SES). Due to the imbalance of regional social and environmental development and different degrees of emphasis placed on environmental and social responsibility, the positive impact of technology innovation on SES is heterogeneous between the east and the central and west regions. Moreover, as the strategic emerging industry, although the renewable energy industry is granted lots of subsidies from the government, the results show that when government subsidies exceed the threshold, the effect of technology innovation on FS is weakened. Government subsidies have a negative moderating effect on the relationship between innovation and SES. Furthermore, we subdivide government subsidies into government subsidies beforehand (GSB) and government subsidies afterwards (GSA). We reveal that the threshold effect of government subsidies mainly comes from GSA, while the moderating effect of government subsidies is caused by GSA and GSB. This paper is an expansion and enrichment of current studies on sustainable development and also puts forward feasible suggestions for the government to formulate precise and effective subsidy policies to stimulate technology innovation.
Highlights
After 40 years of reform and opening up, China’s economy has entered a “new era,” the mode of economic development has shifted from extensive growth based on scale and speed to intensive growth based on quality and efficiency, and the driving force of development has been converted from factors and investment to innovation
Renewable energy companies obtain different types of subsidies, so this paper subdivides government subsidies into government subsidies beforehand (GSB) and government subsidies afterwards (GSA); we find that different subsidies have different impacts on the relationship between technology innovation and corporate sustainability
In order to further study whether the impact of technology innovation on corporate sustainability has regional heterogeneity, and according to the division of regions by the National Bureau of Statistic, we find that the east covers 445 samples, central covers 105 samples, and west covers 80 samples, which means that listed renewable energy companies are mainly located in the east, with a small number of samples in the central and west, and the development level of the central and west is relatively backward compared to the eastern regions, so this paper divides the region into the east and the central & west (C&W)
Summary
After 40 years of reform and opening up, China’s economy has entered a “new era,” the mode of economic development has shifted from extensive growth based on scale and speed to intensive growth based on quality and efficiency, and the driving force of development has been converted from factors and investment to innovation. Some scholars consider that the corporate sustainable competitive advantage comes from their resources, which are difficult to imitate (Wernerfelt, 1984; Barney, 1991; Xu et al, 2019), and the scarce resources that companies cannot imitate come from the creation of R&D activities (Bakar and Ahmad, 2010; Jawad and Mustafa, 2019) They believe that innovation is an important tool to achieve economic growth, environmental protection, and social development at the same time, and is the best way to use resources (Klewitz and Hansen, 2014; Akwesi, 2019). Due to the imbalance of regional social and environmental development in China, whether the relationship between them has regional heterogeneity is worthy to be explored
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