Impact of conglomerates on corporate green innovation in China

Green innovation serves as a pivotal approach to address environmental challenges and drive sustainable economic development. Using a sample of companies listed on the Shanghai and Shenzhen A-share markets from 2003 to 2024, this study empirically examines how conglomerates affect corporate green innovation. The results show that conglomerates significantly enhance green innovation—particularly in enterprises located in regions with stricter environmental regulations and those with executives possessing stronger environmental awareness. Mechanism tests reveal that the alleviation of “financing constraints” through the internal capital market and the compensation for “knowledge gaps” through the internal knowledge network are key channels through which conglomerates drive green innovation within their member enterprises. These findings not only contribute to the literature on the role of conglomerates in environmental governance but also provide valuable insights for promoting the green transformation and sustainable development of enterprises.