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The impact of organizational-level political connection on environmental strategy in private firms

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  • Long, Zhineng
  • Duan, Yulan
  • Zhan, Heng

Abstract

Encouraging private firms in emerging economies to adopt environmental strategies presents a significant challenge. Previous literature has extensively explored environmental strategies but has not sufficiently delved into the influence of organizational-level political connections. Using a national sample survey of Chinese private firms in 2016, this study investigates the impact of Party branch on firm's environmental strategies. Our findings reveal that the presence of Party branches significantly boosts green innovation and environmental protection investment among private firms. Furthermore, these effects are positively reinforced by environmental regulatory pressure and public environmental pressure. This study underscores the crucial role of organizational-level political connections, specifically Party branches, in transmitting and coordinating external institutional pressures, thereby fostering firms' environmental strategies.

Suggested Citation

  • Long, Zhineng & Duan, Yulan & Zhan, Heng, 2024. "The impact of organizational-level political connection on environmental strategy in private firms," Economic Modelling, Elsevier, vol. 132(C).
    • Handle: RePEc:eee:ecmode:v:132:y:2024:i:c:s026499932300456x
    DOI: 10.1016/j.econmod.2023.106644
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    More about this item

    Keywords

    Political connection; Environmental strategy; Party branch; Green innovation; Environmental protection investment;
    All these keywords.

    JEL classification:

    • E22 - Macroeconomics and Monetary Economics - - Consumption, Saving, Production, Employment, and Investment - - - Investment; Capital; Intangible Capital; Capacity
    • G34 - Financial Economics - - Corporate Finance and Governance - - - Mergers; Acquisitions; Restructuring; Corporate Governance
    • O16 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Financial Markets; Saving and Capital Investment; Corporate Finance and Governance

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