The impact of ESG performance on green technological innovation in textile enterprises under the dual-carbon strategy

Under the evolving paradigm shaped by China’s “dual-carbon” goals, green technological innovation has emerged as a central driver for achieving sustainable development, particularly in the textile industry, a sector characterised by high resource consumption and significant environmental impact. Environmental, Social, and Governance (ESG) performance, widely recognised as a critical metric for assessing corporate sustainability, has received increasing attention for its influence on green innovation. This study investigated the relationship between ESG performance and green technological innovation using panel data from textile companies listed on the A-share markets in Shanghai and Shenzhen between 2015 and 2023. As a labour-intensive industry with intensive energy use and pollutant emissions, the textile sector faces unique pressures to transition toward low-carbon operations, making green technological innovation (e.g., clean production, circular economy technologies) pivotal for its sustainable development. Employing a fixed-effects model, the study revealed that strong ESG performance significantly promoted green innovation within textile firms, with the effect displaying notable heterogeneity across ownership types. Further analysis indicated that ESG performance facilitated green innovation by attracting heightened attention from analysts, thereby alleviating information asymmetry and enhancing external oversight. These findings contribute to the literature on ESG and corporate green innovation, offering theoretical and practical guidance for textile firms seeking to enhance green technological capabilities through improved ESG strategies in the context of China’s dual-carbon policy agenda.