China's Internet sector reforms and the rise of ESG in the state techno‐nationalist agenda

Abstract

From 2020 onward, sweeping reforms were implemented in China's domestic Internet sector that stirred debate about its future. Analyzing all Chinese government policies and penalties issued on domestic Internet enterprises from 2020 to 2022, this article provides the first systematic account of the authoritative themes that guided the design of the policy reforms. Latent Dirichlet Association topic modeling and qualitative content analyses reveal that policy reforms are guided by a state techno‐nationalist agenda shifting closer to a framework of environmental, social, and governance concerns (ESG). The results show that the new policies restructured Internet firm operations, capital allocation decisions, and accountability mechanisms with local government collaborators to ultimately push firms toward improving ESG adherence: social wellbeing, corporate governance, and environmental sustainability. This article theorizes that these changes reposition the Internet sector in a new techno‐nationalist agenda, shifting it from a vehicle of unfettered economic growth to an incubator for social wellbeing and sustainable finance.