The effects of public attention on the environmental performance of high-polluting firms: Based on big data from web search in China

Abstract

Abstract Decades of rapid economic development in China have led to a growing public awareness of the importance of environmental protection. In addition to government regulation, public attention of companies is an important legitimacy-granting institution with the potential to influence corporate behaviour, as firms with high levels of public attention potentially bear more cost for pollution and other environmentally concerning actions. Using public web search volume data as a proxy for public attention to individual firms, this study explored the effects of public attention on the environmental performance of firms in high-polluting industries. We found that firms exposed to higher levels of public attention had better environmental performance, especially state-owned firms. This association was strengthened for firms located in cites with high environmental pressure or low economic development pressure. These results can help inform further efforts to promote and sustain environmentally friendly corporate practices in China.