Environmental Regulations Research Articles

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.

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.

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.

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.

Green credit, financing constraints, and corporate investment: From the perspectives of scale and efficiency

Green credit plays a crucial role in resource allocation as it serves as a link between financial systems and environmental protection. This study utilizes the “Green Credit Guidelines” issued by the China Banking Regulatory Commission in 2012 as an exogenous shock, employing the Difference-in-Differences (DID) approach to examine the impact of green credit policies on corporate investment levels. The findings reveal that green credit enhances investment efficiency by reducing the investment scale of high-pollution enterprises. Furthermore, considering the temporal nature of policy impact and strategic responses from enterprises, these effects become evident and increasingly strengthened two years after policy implementation. The financing constraint intermediary mechanism suggests that financing constraints only serve as an intermediary factor between green credit policies and investment efficiency, exerting relatively weak control over short-term investment scales. Additionally, internal and external regulatory mechanisms along with enterprise heterogeneity indicate asymmetric effects resulting from green credit policies. Policy implications derived from this research emphasize the necessity for a rational combination of command-and-control environmental regulations with green credit policies while also improving upon existing green credit measures to prevent strategic corporate behavior.

Can retail investor activism inhibit corporate greenwashing behavior: Evidence from investor interactive platforms in China

Different from developed markets, China capital market is dominated by retail investors. In the digital age, retail investors are increasingly making their voice heard through online channels, which is a new form of shareholder activism in China. This paper examines the association between retail investor activism (RIA) and corporate greenwashing behavior (CGB) using the data of question raised by investors on official investor interactive platforms (IIPs) in China. We discover that the RIA on IIPs is negatively associated with CGB. The mechanism analysis shows that the RIA helps to curb CGB through promoting information transparency and improving internal corporate governance level. We also find that the association between RIA and CGB is strengthened in regions with weaker green finance and environmental regulation, and in industries with weaker product market competition. This indicates that the RIA, a type of private governance, can serve as a substitute to the governance effect of the government and the product market. Further studies show that RIA on unofficial channels such as stock forums or search engines can promote CGB, contrary to the conclusion about IIPs. Our research suggests that strengthening the rights of retail investors helps to reduce CGB and demonstrates the importance of official channels in the governance role of RIA in emerging markets.

Environmental Regulation and Enterprise Employment Creation: A Quasi-Natural Experiment Based on the Implementation of the New Environmental Protection Law

This paper empirically tests the effects of environmental regulations implemented under the new Environmental Protection Law. The findings indicate that, among heavily polluting listed companies, a quasi-natural experiment based on the new Environmental Protection Law can promote the employment creation effects of enterprises. Moreover, heterogeneity analysis suggests that this is primarily observed in state-owned enterprises and those located in the eastern part of the country. This study provides significant empirical evidence for the factors affecting enterprise employment creation and contributes a fresh perspective to the field.

Environmental regulation and productivity growth in the euro area: Testing the porter hypothesis

This paper examines the impact of changes in the stringency of environmental regulations on productivity growth. We exploit several data sources, including the OECD Environmental Policy Stringency Index and balance sheet information from ORBIS and iBACH, to test the Porter hypothesis, according to which firms’ productivity can benefit from more stringent environmental policies. We estimate the regulatory impact over a five-year horizon using panel local projections. To identify the direction of the effects, we estimate CO2 equivalent emissions for all firms in our sample using a machine learning algorithm. As suggested by the country-level analysis and confirmed by the firm-level analysis, policy tightening negatively affects productivity growth of high-polluting firms and to a larger extent than that of their low-polluting peers. Hence, we do not find support for the Porter hypothesis in general. However, not all policies have the same impact - non-market based policies are the most detrimental to productivity growth - and not all highly polluting firms are affected in the same way - the negative impact is mitigated for large firms, which may benefit from easier access to finance and greater innovativeness.

Assessing the Impact of Fiscal Decentralization and Green Technology Innovation on Renewable Energy Use in European Union Countries: What is the Moderating Role of Political Risks?

Renewable energy use plays a substantial role in sustaining environmental quality. Therefore, there is a need to make substantial efforts to advance the renewable energy sector and to provide affordable, clean, and reliable energy to attain sustainable goals. With this notion, the present study aims to assess the definitive roles of green technology innovation (GTI), green finance, fiscal decentralization, political risk, and environmental regulations in fostering renewable energy use while controlling for the effects of industrial structure and economic growth for ten selected European Union (EU) nations spanning from 2000 to 2020. The study’s findings reveal that while GTI, green finance, and fiscal decentralization foster renewable energy use, political risk impedes renewable energy use in EU nations. Notably, this study advises EU nations to persuade the integration of local and federal governments for the devolution of fiscal powers and ensure a stable political environment to promote green innovation and investments in the renewable energy sector to realize sustainable 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.

Effects of manufacturer fairness concerns and carbon emission reduction investment on pricing decisions under countervailing power

Government policies have focused on carbon emissions from the green supply chain (GSC). To discuss how price decision-making in GSC is affected by the manufacturer’s fairness concerns, retailer’s countervailing power, and carbon emissions reduction, the Stackelberg model assumes that consumers are environmentally sensitive. To explore this problem considering the type of manufacturer’s behavior preferences, we built four models that pertain to the following two situations: the retailer has countervailing power, and the retailer has no countervailing power. The results show that (1) the manufacturer’s disadvantageous fairness concerns reduce the overall supply chain profits and utility; influenced by countervailing power, the members witness a win-win situation; (2) moderate advantageous fairness concerns benefit GSC members; furthermore, under advantageous fairness concerns, the manufacturer can “give profits” to the retailer; (3) affected by the retailer’s countervailing power, no bargaining agreement is made in the GSC under advantageous fairness concerns. Finally, the interplay between member decisions and consumer sensitivity is explored. This study can help manufacturers achieve emission reduction targets in response to consumer environmental awareness and government regulation.

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.