Does charitable giving reduce firms’ willingness to invest in green innovation?

Abstract

While corporate charitable giving(CG) can help firms obtain external innovation resource support, it can also crowd out internal innovation resources. The purpose of this study is to clarify the mechanism of CG and government green subsidies(GS) on green innovation(GI). In this regard, we integrated signaling theory and principal-agent theory to provide a new theoretical perspective for simultaneously focus on the impact of external resource acquisition and internal resource allocation on GI. We conducted a threshold regression analysis on the balanced panel data of 863 listed companies of China from 2016 to 2019 to clarify the input boundary between the promoting and inhibiting effects of corporate CG on corporate GI. And we further explored the relationship between GS and GI under the effect of different CG thresholds. Our findings indicate that there is an inverted U-shaped threshold effect of CG on GI. The impact of GS on GI shows a decreasing marginal benefit as the intensity of CG increases. Based on the findings, we propose corresponding countermeasures for the management of enterprises and the government.

Can Civilized City Construction Promote Enterprise Green Innovation?

“…With broad coverage, it connects various participants in the capital market, including investors, enterprise management, regulators, analysts, and more. Increased media coverage makes enterprises more visible to the public, not only increasing the market's demand for specific information about enterprises but also influencing stakeholders' attitudes and decisions as well as the attention of regulatory authorities [74,75]. Enterprises receiving more media attention face greater external supervisory pressure, which may prompt them to adopt more proactive green innovation strategies.…”