Abstract
Many studies focus on the impact of green innovation on enterprises, but few studies pay attention to the difference made by the impact of green innovation at the different stages of a firm’s life cycle. This study used Chinese A-share listed companies as a sample to conduct research and found that green innovation has a positive effect on a firm’s value. However, compared with firms at a mature stage of their life cycle, the impact of green innovation on firm value is more significant in firms at the stages of growth and decline. Further research shows that green innovation can increase the value of firms at the growth stage by improving their sustainable development capability and reducing debt financing costs. However, for firms at the decline stage of their life cycle, green innovation can only increase firm value by reducing debt financing costs. In addition, the nature of property rights and the level of corporate governance will have a moderating effect on the relationship between green innovation and firm value. This research will not only enrich the previous literature but also guide the allocation of resources for firms at different stages of their life cycle to carry out green innovation.
Highlights
The results show that green innovation has a positive effect on firm value and that the impact of green innovation is different at different stages of a firm’s life cycle
This paper uses Chinese A-share-listed companies as a sample to study whether green innovation has an impact on firm value and how this impact differed at different stages of an enterprise’s life cycle
We found that green innovation has a positive impact on firm value, but the degree and the mechanisms of this impact are different at different stages of enterprise life cycles
Summary
With the development of the global economy, the contradiction between the socialeconomic system and the ecosystem has become increasingly prominent. Using the green patent data of Chinese A-share-listed companies during 2007–2019, our study intends to examine whether green innovation has an effect on firm value and whether the impact of green innovation is different at different stages of the firm’s life cycle, which will cover the research gaps mentioned above. Compared with previous studies, this paper is based on the enterprise life-cycle theory and examines the degree of impact of green innovation on firm value at different stages of the enterprise life cycle, which can cover the research gap in theoretical analysis and enrich the enterprise life-cycle theory. This paper finds that green innovation has a positive impact on firm value and tests the mechanism in this relationship, which is a kind of supplement to previous studies and can cover the research gap with an empirical test.
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