Climate policy uncertainty and corporate green innovation performance: From the perspectives of organizational inertia and management internal characteristics

Abstract

The impact of policy uncertainty caused by climate change has attracted widespread attention, but there are few studies on the relationship between climate policy uncertainty and corporate green innovation performance. This paper uses a sample of the A‐share listed companies in Shanghai and Shenzhen from 2007 to 2020 to explore the impact of climate policy uncertainty on corporate green innovation performance. And this paper also studies the moderating effect of organizational inertia and the joint moderating effects of managerial openness and organizational inertia, as well as managerial risk‐taking propensity and organizational inertia. The results show that climate policy uncertainty positively affects corporate green innovation performance. And organizational inertia can positively moderate the impact of climate policy uncertainty on corporate green innovation performance. Besides, managerial openness and organizational inertia, as well as managerial risk‐taking propensity and organizational inertia, jointly moderate the impact of climate policy uncertainty on corporate green innovation performance. When both managerial openness and organizational inertia are higher, the positive impact of climate policy uncertainty on corporate green innovation performance is the strongest. When both managerial risk‐taking propensity and organizational inertia are lower, the positive impact of climate policy uncertainty on corporate green innovation performance is the weakest.

Climate policy uncertainty and regional innovation performance: New empirical evidence from the United States

“…Similarly, investment regarding R&D and acquiring patents will discourage managers in a high CPU situation. In brief, literature supports that CPU inversely affects RIP (Bai et al, 2023;Huo et al, 2023). Furthermore, extending such logics to our context, we may hypothesize that H1.…”

“…This negative impact can be explained as high EPU leads to deter private sector investments aimed to enhance the innovation within the country. In the high CPU era, businesses and private investors may feel hesitation to allocate resources for R&D when they are unsure about the regulatory environment, making the expansion of innovative technologies more difficult (Huo et al, 2023;Liu et al, 2023). Moreover, an increase in climate uncertainty can lead to risk aversion among investors and innovators.…”

“…The term "climate policy uncertainty," which was recently coined by Gavriilidis (2021), relates to governments' changeability and unpredictability in creating and executing environmental policies (Huo et al, 2023). The foundation for developing and utilizing this indicator is the way governments' climate policies are influenced by uncertainty.…”

The impact of environmental, social, and governance ratings on corporate innovation: From the perspective of informal institutions

“…A growing number of academic studies have examined several factors in corporate innovation. Most of the above studies focused on the examination of innovation inputs, specifically R&D investments, as well as innovation outputs, primarily represented by patents (Huo et al, 2023;Lin & Lu, 2023). The conclusions are mixed.…”

Fishing in muddy water? Climate policy uncertainty and corporate greenwashing in environmental, social, and governance

“…At the same time, existing studies have demonstrated from the perspectives of corporate investment (Huang, 2023) and corporate value (Naseer et al, 2023) that the rise of CPU may have adverse effects on enterprises. Additionally, the impact of CPU often outweighs that of the economic policy uncertainty commonly known to people (Huo et al, 2024). These factors endow the study of the relationship between CPU and corporate greenwashing with deeper practical significance.…”