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- Title
Does corporate green investing reduce stock price volatility?
- Authors
Zhao Lingdi; Wang Xiaofei; Xu Le
- Abstract
Under increasingly stringent environmental supervision, corporate green investment behavior is not only the fulfillment of environmental responsibility, but also an effective means to stabilize investor confidence, reduce stock price volatility, and curb the unique anomaly of ’surge and collapse’ in China’s stock market to a certain extent. Unlike the previous studies that discussed the preventive factors of stock price fluctuations or crash risk mostly from the perspectives such as institutional investors’ shareholding, media supervision, company transparency, this article, taking the listed companies in the heavily polluting industries mainly responsible for environmental pollution as a sample and combining manually collected green investment data with measured stock price volatility data,empirically tested the relationship between green investment and stock price volatility with the control function approach and sensitivity analysis method from the unique perspective of green investment and the performance of corporate environmental responsibility. On the basis of controlling endogeneity, we further innovatively adopted the causal mediation analysis model to identify the causal mechanism that green investment affected the stock price volatility through the information environment and institutional investors’ shareholding,and analyzed the heterogeneous influence of corporate green investment on stock price volatility under different property rights and different degrees of marketization.
- Subjects
CHINA; STOCK prices; SUSTAINABLE investing; ENVIRONMENTAL reporting; PRICE regulation; PRICE fluctuations; STOCK exchanges
- Publication
China Population Resources & Environment, 2022, Vol 32, Issue 7, p1
- Publication type
Article