How does family ownership and management influence green innovation of family firms: evidence from China

Abstract

PurposeBased on the socio-emotional wealth and agency theories, this study empirically investigates the impact of family ownership and management on green innovation (GI) in family businesses, as well as the moderating effects of institutional environmental support factors, namely, the technological achievement marketisation index and the market-rule-of law index.Design/methodology/approachThis study empirically tests the hypotheses based on a sample of listed Chinese family companies with A-shares in 14 heavily polluting industries from 2009 to 2019.FindingsThere is a U-shaped relationship between the percentage of family ownership and GI, and an inverted U-shaped relationship between the degree of family management and GI. Additionally, different institutional environmental support factors affect these relationships in different ways. As the technological achievement marketisation index increases, the U-shaped relationship between the percentage of family ownership and GI becomes steeper, while the inverted U-shaped relationship between the degree of family management and GI becomes smoother. The market rule-of-law index weakens the U-shaped relationship between family ownership and GI.Originality/valueFirst, the authors enrich the research on the driving factors of GI from the perspective of the most essential heterogeneity of family businesses. This study shows nonlinear and opposite effects of family ownership and management on GI in family firms. Second, this study contributes to the literature on family firm innovation. GI, not considered by researchers, is regarded as an important deficiency in research on innovation in family businesses. Therefore, this study fills that gap. Third, the study expands research on moderating effects in the literature on GI from the perspective of institutional environmental support factors.

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

“…By utilizing new concepts and technologies to achieve environmental pollution reduction and resource consumption savings and bringing the corresponding economic benefits (Yin et al, 2022), green innovation is also one of the ways to improve the sustainable competitive advantage of enterprises (Briest et al, 2020; Chatzoglou & Chatzoudes, 2017; Joecks et al, 2023; Qu et al, 2021). There are lots of factors that currently affect corporate green innovation performance, including the management (Chen et al, 2023; Javed et al, 2023), enterprises themselves (Knott & Vieregger, 2020; Wang, 2019; Yang & Chen, 2023), the government (Wang & Wang, 2021; Yin et al, 2022), and so on. Nowadays, with the increasing frequency and intensity of extreme weather events and the occurrence of global warming, the fragility of climate change is gradually becoming prominent, which has caused huge economic losses (Ahmad et al, 2023; Huang et al, 2018, 2022).…”

Common institutional ownership and green innovation in family businesses: Evidence from China

“…Bammens and Huenermund (2020) note that family businesses are motivated to undertake higher levels of ecological innovations to improve their corporate reputation in the face of societal pressures for greater sustainability. From the perspective of organizational characteristics, Ardito et al (2019) find that there is a positive correlation between family involvement and green innovation, while Yang et al (2022) further suggest that there is a U‐shape relationship between the proportion of family ownership and green innovation, and an inverted U‐shape relationship between the degree of family management and green innovation. In addition, by exploiting the unique heterogeneity of family business origin in China, Cheng, Li, et al (2022)find that restructuring family firms have a higher degree of green innovation than entrepreneurial family firms.…”

ESG performance and firms' innovation efficiency: the moderating role of state-owned firms and regional market development

“…In addition, prior research has called for examining the signaling effect of specific signals in transitional economies and to highly prioritize the moderating role of the signaling environment at the institutional level (Ren et al, 2022;Zhong et al, 2022). The most typical institutional feature of China is that SOEs play a key role in the national economy (Peng et al, 2022;Zhou et al, 2017), with each region constantly improving its own market institutions (Fang et al, 2023;Yang et al, 2022). Therefore, we further analyze the moderating effect of SOEs and market development on the relationship between ESG performance and firms' innovation performance.…”

“…Although pro-market reform policies are set by the Chinese central government, they are implemented at different levels and speeds by provincial governments (Zhong et al, 2022). Therefore, there are significant differences in market development progress across regions in China (Li et al, 2023c;Yang et al, 2022). It is generally believed that higher the degree of market development, the weaker the role of government intervention, the stronger the role of services and the better the quality of government, leading to less government intervention in firm matters (Xie, 2017;Yang et al, 2022).…”

“…Therefore, there are significant differences in market development progress across regions in China (Li et al, 2023c;Yang et al, 2022). It is generally believed that higher the degree of market development, the weaker the role of government intervention, the stronger the role of services and the better the quality of government, leading to less government intervention in firm matters (Xie, 2017;Yang et al, 2022). Particularly, as the degree of regional market development increases, local governments' ability to intervene in the economy decreases, as does their influence on the allocation of key resources (Du et al, 2017;Zhong et al, 2022).…”