Environmental Regulations Research Articles

Foreign shareholding and corporate environmental expenditure: Evidence from China

AbstractThis paper estimates the effects of foreign investments on the environmental expenditure of listed companies in China by differentiating pre‐IPO foreign investors from post‐IPO foreign investors. Our findings indicate that while pre‐IPO foreign investments make significant and positive contributions, the influence of post‐IPO foreign investments is negligible. These results are particularly pronounced for enterprises that are privately owned, located in coastal China, operating in heavily polluting industries, and whose management lacks prior experience in environmental protection and international vision. Furthermore, research efforts are devoted to uncovering potential channels through which pre‐IPO foreign investments affect corporate environmental expenditure, including environmental regulations in home countries or regions, government attention to environmental issues, media coverage, and corporate financial constraints.

Environmental regulation effects from the perspective on the industrial chain: evidence from energy enterprises in China

More attention has been paid to environmental regulation of greenhouse gas emissions in the energy industry under the transformation of industrial structure. This paper takes microdata of Chinese energy enterprises from 1998 to 2012 as a sample to build a duty-sharing model, analyzes the effect of environmental regulations on the industrial chain, and explains the “double growth” phenomenon that occurred in China, which is nothing short of miraculous in terms of the environment and economy. In the industrial chain, the environmental obligations and responsibilities will be shared between upstream and downstream enterprises due to trade linkages. This paper finds that environmental responsibilities will move forward through the industrial chain when environmental regulations are strengthened. Downstream companies will loosen “relative” control constraints, thereby expanding output but increasing demand for upstream products. Different from the existing research, we claim that, since environmental regulation has a differential effect on the industrial chain, it will promote the growth of output in the entire chain, in contrast to the theory of “cost compliance”, which claims that environmental regulation will inevitably lead to the output. Based on this research, this paper puts forward some suggestions and insights on how the government implements environmental regulations.

Natural resources as a double-edged sword towards ecological quality: Can environmental regulations and green human capital rectify the adverse impacts?

Natural resources are the backbone of any economy and the bedrock of ecological health. However, the relentless exploitation of these resources has given rise to ecological degradation. This threatens ecosystem stability, presenting the urgent need to balance natural resource utilization with ecological integrity. Environmental regulations and green human capital are pivotal in striking this balance and progressing towards the Sustainable Development Goals (SDGs). Therefore, this study explores how natural resources impact ecological quality in Ghana from 1990 to 2019 within the environmental Kuznets curve (EKC) framework, considering the role of environmental regulations and green human capital. The study employs the novel dynamic ARDL simulation method, presenting insights that diverge from patterns noted in previous studies. The study's findings reveal that natural resources intensify ecological quality in the short term but degrade ecological quality over the long term. Environmental regulation reduces ecological harm, while green human capital negatively impacts ecological quality. Environmental regulation and green human capital undesirably and beneficially impact how natural resources relate to ecological quality, with the undesirable effects occurring in the short term and the beneficial effects emerging over the long term. Further, a U-shaped relationship is observed between economic growth and ecological pollution in the short term, which transforms into an inverted U-shaped relationship in the long term, thus validating the EKC hypothesis in Ghana. The study concludes by recommending the implementation and enforcement of environmental regulations as a pathway toward achieving ecological quality and SDGs, particularly SDG 13, SDG 12, and SDG 7.

Subnational institutions, firm capabilities and eco-innovation

Abstract We examine the role institutional pressures, at the subnational level, play in the generation of eco-innovations and explicitly consider how they interact with firms’ heterogeneous capabilities and ownership characteristics. Theoretically, we combine elements from institutional theory with the resource-based view of the firm to develop our hypotheses. Empirically, we use a novel dataset over the period 2003–2013 compiled from several sources: (I) environmental regulations (city-level) from the China Environmental Statistical Yearbooks and City Statistical Yearbooks; (II) green patents (firm-level) from the China National Intellectual Property Administration; and (III) ownership (firm-level) from the National Bureau of Statistics. Our econometric analysis employs an instrumental variable (IV) approach that controls for endogeneity and a negative binomial multilevel methodology for robustness. The results show that institutional pressures associated with environmental regulations, implemented at city level, lead to more green patents produced by firms in these jurisdictions. Crucially, the effectiveness of environmental regulation is enhanced when firms invest more in their internal technological capabilities. Finally, we find that a firm’s affiliation with a business group enhances the positive effects of regulations in terms of the production of eco-innovations.

NanoBiofertilizer and its Application in Sustainable Agriculture, Crop Specific Nutrients Delivery and Environmental Sustainability: A Review

Probiotic bacteria are increasingly in demand in the food and feed industries. A growing population and finite resources require efficient ways to maximize yields. Probiotic bacteria are gaining popularity in the food and feed industries due to their unique combination of benefits and values, which include consumer health interests, sustainability values, food innovation, and potential business opportunities. The use of conventional fertilizers can increase crop production but can also cause runoff and toxicity issues. A nanobiofertilizer offers improved crop nutrition and reduces application rates. Slow-release properties minimize environmental losses while nanoscale particle size enhances nutrient absorption. If nanobiofertilizers are closely regulated, they can boost yields without destroying the soil and aquatic ecosystems. In recent years, nanobiofertilizers have received considerable attention. Plant extracts and microbes are used in green synthesis to produce eco-friendly nanoparticles. Crop-specific nutrient release can be tailored using modified nanoparticle surfaces. Controlled nutrient delivery is achieved by smart nanocarrier systems that adapt to changing soil moisture, pH, and microbial activity. Combined applications of plant growth-promoting rhizobacteria have been reported that they can enhance crop growth in synergy. This review presents an overview of the most recent studies on nanobiofertilizers, as well as the issues connected with their environmental implications, safety, and regulation, presenting a roadmap for the responsible use of nanobiofertilizers, which aims to enhance food security while protecting the environment for future generations.

Moving from voluntary to mandatory sustainability reporting—Transparency in sustainable development goals (SDG) reporting: An analysis of Germany's largest MNCs

AbstractA growing number of multinational companies (MNCs) report on their progress toward contributing to the Sustainable Development Goals (SDGs) in their annual reports, yet the amount and quality of the information they disclose varies significantly. The aim of this study is twofold: First, we investigate how transparent MNCs report on their SDG engagement and second, we study how the reported SDG engagement changed over time due to major shifts in sustainability reporting requirements. Using a dataset of the largest German MNCs, we analyze their disclosure of SDG contribution reporting practices. Our results show that, overall, between 2016 and 2021 all German MNCs increased their SDG reporting activity and that the MNCs adopted four different practices to report their SDG engagement. We also found that the largest MNCs were more transparent and systematic in their SDG reporting than smaller MNCs, whose reporting was more heterogeneous. Our study contributes to legitimacy research and the role of transparency in corporate reporting as well as the debates on the efficacy of sustainability reporting legislation in the context of SDG engagement. Our findings imply that regulations on environmental and social regulation increase the transparency of sustainability reporting.

How does digital finance influence corporate greenwashing behavior?

This paper examines the effects of digital finance and corporate greenwashing as well as the underlying mechanisms using panel data from China's A-share, listed companies between 2012 and 2021. By employing panel regression and mediation effect models, we demonstrate that digital finance considerably inhibits corporate greenwashing. This conclusion remains robust after a series of tests, including replacing the core explanatory variables, lagging digital finance by one period, using alternative dependent variables, and applying the instrumental variables method. More importantly, we find that digital finance curbs corporate greenwashing by alleviating financing constraints and improving informational transparency. In addition, we reveal that digital finance has heterogeneous effects on corporate greenwashing. The inhibitory effect of digital finance on corporate greenwashing is more pronounced for high-polluting industries, under the conditions of strict environmental regulations, and in China's central and western regions.

How does the green credit policy affect corporate ESG performance?

This study employed the difference-in-difference (DID) method to examine the impact of the 2012 Green Credit Guidelines (GCG) policy on enterprises' ESG performance. The findings demonstrated that, compared to enterprises in non-heavily polluted industries, highly polluting enterprises were compelled by the GCG policy to strategically enhance their environmental performance due to financial constraints and the effects of environmental disclosure. This affected the ESG performance. However, the effects on social and governance performance were not significantly different. Additionally, the GCG policy had a notably positive impact on the ESG performance of state-owned, large, and mature companies, while it negatively affected the ESG performance of companies in the growth phase. The effective implementation of the policy was supported by stringent environmental regulations and a high degree of financial development. Finally, based on the empirical results, this study offers recommendations for policy adjustments, raising enterprise awareness, and improving the external environment.

Prevention or ex-post forcing? The impact of dual environmental regulation on corporate environmental behavior

Corporate reactions to environmental regulation are the hottest topics in research on corporate environmental behavior. However, a few studies incorporate other environmental behavior into the same framework. By constructing a comprehensive indicator system of dual environmental regulation, this paper uses a comparative analysis to discuss Chinese A-listed corporations' environmental behavior from 2009 to 2017, which were influenced by dual environmental regulation. The study's results show that formal environmental regulation (FER) has a significant U-shaped effect on pre-emptive environmental behavior (PEB) but an insignificant impact on ex-post environmental behavior (NEB). After categorizing the various forms of FER, this study finds that market-incentive environmental regulation has a significant inverted U-shaped effect on NEB but an insignificant impact on PEB, voluntary-participation regulation have a significant U-shaped effect on PEB and an inverted U-shaped effect on their NEB, and command-control regulation has significant influence on neither PEB nor NEB. In addition, informal environmental regulation (IER) has a significantly positive and negative effect on PEB and NEB. This study shows that corporate perceptions of policies can have a positive impact on the interaction between the FER and PEB but a negative impact on the interaction between the IER and PEB, and no impact on the interaction between FER or IER and NEB. Moreover, the impact of FER and IER on corporate environmental behavior (CEB) varies depending on factors like ownership, industry characteristics, the market environment, and regional development. Therefore, governments should understand the choices related to corporate environmental behavior under the dual environmental regulation—formal and informal—and prioritize the synergistic impact of these dual environmental regulation, highlighting their enforceability, and take into account the heterogeneity of their targets and the market to stimulate PEB and decrease NEB to help enterprises align their short-term economic objectives with their long-term social goals.

Who will Spend more Pollution Abatement Costs: does Size Matter?

This paper looks at the relationship between enterprise size and pollution abatement costs using firm-level datasets in China, where size-dependent distortions may exist in the distribution of enterprises of different sizes. We find that the pollution abatement costs decrease with enterprise size. Compared to the smallest size, the magnitudes of marginal decreases in pollution abatement costs per 1000 CNY of industrial output in the largest size are 3.29 CNY, 0.54 CNY and 2.60 CNY for gas, SO2 and dust, respectively. Moreover, we further explore the potential mechanisms for the decrease of pollution abatement costs from three perspectives: environmental protection-related investment, regulation intensity, and technological capability. Our findings suggest that the decrease in the intensity of environmental protection-related investment for large enterprises may be directly reduce the intensity of pollution abatement costs. Although large enterprises have low intensity of pollution abatement costs, this does not mean that they are subject to weaker environmental regulation. More importantly, we find that large enterprises may have more adoption of abatement technologies. For SO2 and dust, the pollutant removal efficiency of the largest enterprises is 4.92% and 1.82% higher than that of the smallest enterprises, respectively. Our results are robust to different specifications. These findings help us enact appropriate policies for enterprises based on their size, thereby improving the efficacy of pollution abatement and achieving the optimal level of pollution abatement for the entire society.

Does Chinese Environmental Policy Affect Income Inequality? Evidence from the Central Environmental Protection Inspection

AbstractThis paper investigates the effect of environmental policy on income inequality. It focuses on the central environmental protection inspection led by the central government in China. Using a difference‐in‐differences approach, it finds evidence that environmental regulation decreased the per capita income and enlarged the gap between urban and rural income while showing an insignificant effect on employment. Although the policy can reduce pollution levels and bring environmental benefits in aggregate, the findings of this study suggest that the regulations appear to have reduced the proportion of manufacturing industry and hindered general innovation and investment from entrepreneurs, which resulted in greater inequality. Rural residents suffered more from environmental regulation due to relatively high migration costs and their disadvantaged human resources on the aspects of health, education level, and skills. The local government's execution incentive can also play a key role in the effectiveness of environmental policy. Regions with lower GDP growth targets and younger government leaders were affected significantly with regard to the income growth of local residents and the urban–rural income gap.

Application of GIS to monitor the impact of urbanization on surface water quality in Kim Dong district, Hung Yen province, Vietnam

Rapid urbanization profoundly affects surface water quality in lower-income countries, often extending pressure on resources beyond urban areas. This study assesses the impact of urbanization on surface water quality in Kim Dong district, highlighting its broader implications for the Red River Delta. The demands of urban systems significantly strain natural resources, notably water, impacting both human consumption and environmental sustainability. With a focus on less developed regions where water infrastructure may be limited, ensuring sufficient water supply as these areas grow presents a complex challenge. The economic and population growth in Kim Dong district has heightened water demand in recent years. Despite ample water sources, Kim Dong district is facing surface water pollution, leading to shortages for domestic, agricultural, and industrial use. This study aims to evaluate surface water quality using the Water Quality Index (WQI) and examine urbanization’s impact, employing GIS to map pollution loads across communes. Results of the study reveal significant water quality deterioration, notably in areas with high population density and industrial concentration, causing severe pollutant loads in rivers. Hierarchical Cluster Analysis (HCA) and Discriminant Analysis (DA) was utilized to classify communes into three distinct clusters based on pollutant loads, emphasizing Luong Bang town and adjacent communes as high-load areas. The study demonstrates a strong positive correlation between population density and pollutant loads, indicating the profound impact of urbanization on water quality. Our research calls for strict monitoring of discharge sources, especially from industries and residential areas, emphasizing compliance with environmental regulations. It recommends regular drainage system maintenance, comprehensive environmental assessments for future development plans, and consistent efforts to mitigate urbanization’s adverse effects on surface water in Kim Dong district. These measures aim to sustainably manage water resources and safeguard environmental integrity amidst rapid urbanization.

Manipulation of the leaching behaviour of high-alloyed steel EAF slags through the particle size modulation

The safe disposal of EAF slag have become crucial due the environmental and health protection regulations. Its direct reuse is hampered by the possible release of toxic elements into the surrounding environment over time. Specifically, EAF slag from high-alloyed steel production could potentially release toxic metals (e.g., Ba, Cr, Mo and V). Currently, the assessment of leaching behaviour is carried out according to the EN 12457:2002 standard, which generically specify that the material should not be finely ground, limiting the particle size as much as possible. However, no guidance is given on reducing particle size and handling fine fractions, which could lead to manipulation of data and variability of results. In this work six different fractions (from <4 mm to <63 μm) of EAF slag from high-alloyed steel production were investigated. X-Ray Diffraction, Scanning Electron Microscopy and selective C2S dissolution were used to correlate the leaching behaviour with particle size and identify which mineral can alters the release of specific toxic elements. The pH of the water was measured immediately after filtration, and the solution was analysed by Inductively Coupled Plasma-Optical Emission Spectrometry. In addition, five mixtures were prepared using different mass fractions of the six granular fractions with the aim of unbalancing the mixtures toward coarser or finer fractions, respectively. All the mixtures were subjected to leaching under the same previous conditions and analysed to evaluate the behaviour of the different blended fractions. To investigate the predictability of the leaching behaviour of the mixtures, the experimental results were compared with the values predicted by a theoretical model calibrated using the results obtained from the leaching results of the six particle size fractions. The investigation showed that the leaching behaviour is negatively affected by the particle size reduction, mainly due to the increase of surface-to-volume ratio, which increases the dissolution rate. Similarly, the mass fraction of the main crystalline phases that regulate leaching (unstable spinels, brownmillerite and larnite) is also correlated with the change in particle size. Consequently, the leaching results for the mixtures highlighted a critical aspect contained in the European standard. Even small changes in particle size can lead to different concentrations of toxic metals in leachates, which can then be manipulated to achieve the desired result.

Evaluation of the benefits of tradable peak energy use rights products

Environmental degradation and energy security issues require our country to accelerate the transition of its energy consumption structure towards decarbonization. Clarifying the impact of the pilot trading system of peak energy use rights products on the low-carbon transformation of energy consumption structure and the path of its effect is an important policy revelation for the construction of market-based environmental rights and interests regulation. In this paper, we study the implementation effect of the pilot provinces of peak energy use right product trading from the perspective of carbon emission reduction benefit and analyze the carbon emission reduction benefit generated by the peak energy use right product according to the pilot trading situation.

Suitable solutions and EU regulatory framework of electric light mobility vehicles for last-mile delivery: an overview

Due to current environmental European regulations in terms of pollutant emissions, electric cargo cycles are receiving growing interest compared to heavy-duty vehicles as a cheaper and healthier alternative for last-mile delivery of goods in urban and suburban areas. Within the PNRR Next Generation EU program, the Sustainable Mobility Center aims to design innovative e-cargo bikes considering technical features along with rider behaviour and infrastructure characteristics. The market offers plenty of solutions, which may differ in technical and design features. Nowadays a standardized terminology, widely shared among researchers for those light mobility vehicles does not exist. Several authors employ different terms or introduce classifications based upon the vehicle type of use or even on the vehicle layout (e.g., payload position or number of wheels). Concurrently, EU regulatory framework is undergoing rapid changes and appears unclear. Certain categories of light mobility vehicles might be ruled out from the type-approval system established by the regulation EU 168/2013. For those vehicles, harmonised standards are under drafting or approval. This situation requires a considerable effort among manufacturers in the identification of the proper product directives or regulations and the associated mandatory requirements and testing procedures for the introduction of a new vehicle model in the market. Within this context, an overview of the EU regulatory framework for these light mobility vehicles is presented. A literature evaluation with a structured and coded methodology of scientific databases, company websites and commercial reports is performed, evaluating commercial and prototype solutions of e-cargo bikes from a technical and legislative perspective. Furthermore, a case study is addressed, deepening the national legislation which rules the use of e-cargo bikes in Italy. The information provided in this work may be useful among manufacturers as a starting point for the design process of these types of vehicles. Moreover, this paper lays the foundations for a widely recognized taxonomy of e-cargo bikes based upon distinctive features.

How does market-incentive environmental regulation affect enterprises green growth? The mediating role of R&D investment and innovation output

Manufacturing enterprises is a country's economic mainstay. However, their longtime extensive growth pattern of “high growth and high emission” has brought huge environment pollution and restricted sustainable development. Under the circumstance of carbon reduction and global green development, market-incentive environmental regulation (MER) has attracted the attention of scholars and become a kind of important methods of encouraging manufacturing enterprises green growth. Presently, two fairly distinct viewpoints of “Follow Cost” and “Porter Hypothesis” both have their own supportive research results, and the explanation for the role of MER is completely opposite. What's more, empirical research at the enterprise level is scarce. Therefore, this study makes a further analysis from the perspective of enterprises heterogeneous innovation ability. Guided by the classic theory of “Follow Cost” and “Porter Hypothesis”, this study aims to evaluate the applicable conditions of MER's environmental improvement effect, and testing the differential impact mechanism of MER on enterprise Green Total Factor Productivity (GTFP), enterprise Green Technological Change (GTC) and enterprise Green Efficiency Change (GEC). All these give theoretical and empirical supplementation for the rationality of related theories. This study examines the hypotheses and mechanism according to 1220 Chinese manufacturing listed companies data 2011–2020. The empirical results indicate that: (1) In short term, MER has a significant positive impact on GTC, and a significant negative impact on GTFP and GEC. (2) As innovation driven factors, both enterprise R&D investment and innovation output play the mediating role. (3) Heterogeneity analysis indicates that the impact mechanism varies depending on enterprise industry-type, location and digital level. Thus, policymakers should develop appropriate MER policies, and manufacturing enterprises should strengthen technological innovation to help achieve environmental sustainability and profit performance.

Impacts of pilot carbon emission trading policies on urban environmental pollution: Evidence from China

The trading of carbon emissions is a crucial regulatory method to address environmental pollution issues. This study takes China's carbon emission trading pilot policy established in 2013 as a quasi-natural experiment and uses the DID model to empirically test the urban panel data from 2006 to 2019. The results show that the carbon emission trading pilot policy can effectively reduce urban environmental pollution, and this effect is more noticeable in mid-western cities, northern cities, cities with fewer resources, and large-scale cities. In addition, to address the urban environmental pollution problem through this policy, the government is encouraged to raise its environmental protection awareness and put more effort into the innovation of technology. In general, this study uses carbon emission trading policies from China to confirm that market-based incentive environmental regulation tools can effectively reduce environmental pollution in urban areas. These findings can provide more theoretical support and empirical evidence for the government to use mechanisms of the market to effectively solve pollution problems, improve ecological environment quality, and accelerate the realization of green economy.

Balancing supply diversification and environmental impacts: A system dynamics approach to de-risk rare earths supply chain

We introduce a System Dynamics (SD) model to examine policy measures aimed at diversifying the global supply chain of rare earth elements (REEs) and reducing reliance on China. Through meticulous simulation experiments, the paper evaluates the effectiveness of individual policies and their combinations (strategies) on enhancing the Rest of the World’s (RoW) market share, minimizing environmental impacts, and meeting the burgeoning demand for Neodymium—essential for green technologies such as electric vehicles and wind turbines.Our findings reveal that direct governmental interventions, particularly those focused on expanding mining and recycling capacities, significantly bolster the RoW’s market share and decrease unmet Neodymium demand. The study also underscores the importance of environmental regulations in promoting sustainable mining practices, which, while slightly constraining market share growth, result in considerable environmental benefits. Among the evaluated strategies, one combining capacity expansion, recycling, and international cooperation emerges as the most effective, marking a substantial increase in RoW market share and a notable reduction in unmet demand.Furthermore, the paper discusses the complex trade-offs between economic development, environmental stewardship, and supply security in policy-making. It calls for a comprehensive approach that considers economic, environmental, and social factors, including public perception and regulation, in REEs mining.In conclusion, our research provides vital insights for policymakers, illustrating how simulated policy interventions can facilitate informed decision-making in the REEs market. By advocating for a balanced consideration of multiple factors, this study contributes to the discourse on sustainable supply chain management for critical minerals.

The role of information industry convergence in energy transition

To cope with global climate risks, promoting energy transformation has become a global consensus. China issued a reform policy in 2010 to promote the convergence of the three major information industries, namely broadcasting and television networks, telecommunications networks and the Internet (TPR policy). However, is the convergence of information industries able to promote energy transition? This study constructs a quasi-natural experimental framework using China's TPR policy as a representative case of industrial convergence. Using city-level panel data between 2003 and 2016 in China and a multi-period difference-in-differences model, this study examines the impact of TPR policy on energy transition. The results show that TPR policy positively contributes to energy transition at a 1% significance level. Extensive robustness tests support this finding. This positive effect is particularly evident in regions with less developed communications infrastructure and stricter environmental regulations. Mechanism analysis suggests that TPR policy promotes energy transition by improving the level of information networks, promoting technological innovation, and optimizing industrial structure. The findings of this paper emphasize the importance of information industry convergence in facilitating energy transformation.

Quenching optimization of a hot stamping line for aluminum automotive components

The rising cost of fuel and harder environmental regulations driving the need for more eco-friendly vehicles have compelled automotive manufacturers to search for innovative lightweight solutions. Consequently, hot stamped aluminum alloys are gaining prominence due to their exceptional specific strength and improved formability compared to cold formed components. Unfortunately, the current state of knowledge in the field lacks the necessary depth to establish a reliable, fast and optimized process for aluminum hot forming. To address this gap, a collaborative effort between Mondragon Unibertsitatea (knowledge provider), Fagor Arrasate (hot stamping line supplier), and Batz (tool manufacturer) has been initiated. The collaborative endeavour aims to conduct semi-industrial trials involving the hot stamping of an authentic automobile bumper employing high-strength 6xxx and 7xxx aluminum alloys. The hot stamping trials have been performed under different in-die quenching times and mechanical properties of the stamped bumpers have been empirically tested. These results have helped to define the optimal quenching time. With that aim, first, a thermophysical and rheological characterization of the aluminum has been performed, followed by the development of a model to predict mechanical properties of aluminum alloys. This predictive model, together with the aluminum material data, has been then integrated into the simulation framework to enable accurate forecasting of mechanical properties and, consequently, the identification of the optimal quenching duration. The results revealed that quenching times as brief as 1 second could be employed while maintaining acceptable mechanical properties in a rapid cycle hot stamping process. These expedited quenching times have the potential to boost production by an impressive 70 % when compared to the conventional hot stamping process applied to the equivalent steel bumper.