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This paper investigates the impact of China's environmental regulations, with a focus on the green credit policy, on green innovation in pursuit of the "carbon peak and carbon neutrality" goal. Given the implementation of the 2012 Green Credit Guidelines, this paper employs the Difference-in-Difference Method (DID) and conducts a quasi-natural experiment to empirically examine the interactions among the central government, local governments, and high-pollution and high-emission enterprises by exploring the impact of green credit policies on green innovation of these enterprises. Relying on 4503 samples of 237 high-pollution and high-emission enterprises listed in the main board in China from 2003 to 2021, this study reveals that the green credit policy can improve green innovation of these enterprises. Specifically, this study explores the detailed mechanism through which the green credit policy enables these enterprises to increase their market concentration and then the monopoly profits, which in turn promotes their green innovative productivity. In addition, this paper also reveals how local governments' political and financial incentives may serve as positive and negative moderating factors, respectively, within the impact mechanism. This study has valuable implications for how to effectively formulate and implement environmental regulations by balancing the interests of the central government, local governments and enterprises. [ABSTRACT FROM AUTHOR]

Green finance is a financial innovation that directs capital allocation towards green industries. How will this affect regional carbon emissions? Based on the data on green finance and carbon emissions of 30 provinces in China from 2008 to 2019, this paper employs a multivariate linear regression model and a spatial econometric model to empirically study the impact of green finance on carbon emissions. The results find that (1) green finance significantly reduces provincial carbon emissions, specifically through promoting a cleaner energy structure and an advanced industrial structure, as well as improving the quality of green innovation. (2) Heterogeneity exists between regions. In eastern regions and areas characterized by high levels of marketization and minimal fiscal pressure, the role of green finance in promoting provincial carbon emission reduction is more pronounced. (3) Spatial econometric analysis found that green finance has a significant spatial spillover effect on carbon reduction in adjacent regions. Specifically, the flow of green resources and green ideas between provinces facilitates the formation of regional radiation, while green competition generates a siphon effect on neighboring regions. These findings provide some meaningful policy implications to achieve China's dual-carbon goal by promoting green finance. • Green finance has significantly reduced China's provincial carbon emissions. • The upgrading of energy structure and industrial structure is a positive channel to reduce carbon emissions. • Green innovation strengthens the carbon reduction effect of green finance, but reveals the potential "greenwashing". • Green finance has a significant spatial spillover effect on carbon reduction in adjacent regions. • Policymakers should develop flexible, dynamic and coordinated green finance development policies. [ABSTRACT FROM AUTHOR]

This paper uses a double-difference model to test the impact of green credit policy on the default risk of heavy polluters based on the data of China listed companies from 2008 to 2021. It is found that green credit policy can significantly reduce the default risk of heavy polluters, and the reduction effect is more significant in state-owned enterprises. Further mechanism tests show that green credit policy reduces default risk by guiding heavily polluting firms to reduce financial leverage. Government environmental regulation and corporate green innovation capacity affect the role of green credit policy on corporate default risk. With the strengthening of regional environmental regulations and the enhancement of corporate green innovation capabilities, the effect of green credit policies in diminishing the default risk for companies with high pollution levels is increasingly evident. This study not only enriches the literature on green credit but also demonstrates the effectiveness of directing banks and various financial entities to allocate resources reasonably, guiding heavily polluting enterprises to control risks, and steadily achieving green transformation. These findings hold significant implications for decision-making in designing environmental policy and management strategies. [ABSTRACT FROM AUTHOR]

As China's longest-implemented market-based environmental regulation policy, emission charges have contributed outstandingly to improving the ecological environment and reducing firms' pollution emissions. We assess the impact of emission charges on the innovation quality of Chinese firms based on the perspective of firms' breakthrough technological innovation. By observing Chinese A-share listed firms with heavy pollution from 2011 to 2020, we find that corporate breakthrough technological innovation positively moderates the emission charges to enhance the quality of corporate innovation. Our mechanism tests suggest that emission charges and breakthrough technological innovation positively affect innovation quality by improving the means of green innovation of enterprises. In addition, heterogeneity analysis shows that emission charges and firms' breakthrough technological innovation are only effective in improving the innovation quality of state-owned firms, and the effect on the innovation quality of non-state-owned firms is not significant. Our findings suggest that the imposition of emission charges and incentives for firms to embark on breakthrough technological innovation can effectively improve the quality of innovation. • The article is probably the first literature to explore the effects of breakthrough technological innovation and emission charges on the innovation quality of heavily polluting enterprises in China, enriching the research on the impact of enterprise innovation models on environmental regulation. • Based on the IPC information of enterprise patent applications, the paper distinguishes enterprise innovation patterns and explores the moderating effect of breakthrough technological innovation on emission charges to enhance the quality of enterprise innovation. • This paper provides micro evidence on the impact of environmental regulation on innovation quality based on the perspective of firms' breakthrough technological innovation, which has important implications for adopting environmental regulation to achieve a "win-win" situation between pollution control and improving innovation quality. [ABSTRACT FROM AUTHOR]

We try to expand the political promotion tournaments in Chinese local governments from raising GDP to the level of increasing fiscal revenues. From the vantage point of officials' performance appraisal, we investigate the impact of local government officials' political ambitions, represented by the ex-ante commitment level of fiscal revenue targets, on carbon emission intensity (CEI). Utilizing a sample of 209 prefecture-level cities in China spanning 2006 to 2019, this paper empirically scrutinizes the influence of local government political ambition on CEI. The findings reveal that the greater the political ambition of local government officials, the more pronounced the reduction in CEI. Furthermore, our study demonstrates that political ambition contributes to the decline of CEI by elevating the levels of environmental attention and green innovation. This research not only aids in comprehending the rationale and necessity of the political promotion tournaments implemented by the Chinese central government but also offers valuable insights for other developing countries seeking to mitigate CEI. [ABSTRACT FROM AUTHOR]

With the rising awareness of green and sustainable development, corporate environmental, social, and governance (ESG) performance has become an essential topic in academia. Existing studies have focused on the driving role of formal institutions on corporate ESG performance while ignoring the motivational role of informal institutions such as culture. Based on the data of Chinese A-share listed companies from 2009 to 2021, this study adopts textual analysis to quantify corporate culture and discusses the impact of corporate culture on ESG performance and its internal mechanism. We find that corporate culture significantly enhances ESG performance. Mechanism test indicates that corporate culture can promote green innovation and improve information transparency through resource and information effect, enhancing ESG performance. We further demonstrate differences in the impact of corporate culture dimensions on ESG performance, with innovation culture and quality culture being the most prominent. In addition, there is heterogeneity in the impact of corporate culture on ESG performance. In the context of non-state-owned property rights, low market attention, and high economic policy uncertainty, the impact of corporate culture on ESG performance is more significant. This paper enriches the related research on ESG performance drivers from the informal system perspective and provides decision-making references for enterprises to promote ESG practices and achieve sustainable development. [ABSTRACT FROM AUTHOR]

In recent years, green innovation has become an important means of achieving sustainable development, but the impact of peer firms on green innovation is less discussed. To fill this research gap, this paper explores the effect of peer firms on the green innovation activities of the Chinese A-share listed firms in the manufacturing industry from 2011 to 2020 and investigates influencing factors of peer effect. The main findings are as follows. First, there is a peer effect in making green innovation decisions. Second, industry competition has a positive moderating effect on the peer effect of green innovation. Third, digital financial inclusion and government intervention both promote the peer effect of green innovation. The peer effect is more significant with a high degree of digital financial inclusion. But the peer effect has no significant difference between different degrees of government intervention. This paper aims to explore the influencing factors of a firm's green innovation from the perspective of peer effect. The research results can provide a guide for the government to better promote green innovation activities of firms and benign competition in the industry. • A firm's green innovation activities are positively affected by industry peers. • Industry competition has a positive moderating effect on green innovation peer effect. • Digital financial inclusion and government intervention both promote the peer effect. • The peer effect is more significant with a high degree of digital financial inclusion. • The peer effect has no significant difference between different degrees of government intervention. [ABSTRACT FROM AUTHOR]

In recent years, green innovation has become an important means of achieving sustainable development, but the impact of peer firms on green innovation is less discussed. To fill this research gap, this paper explores the effect of peer firms on the green innovation activities of the Chinese A-share listed firms in the manufacturing industry from 2011 to 2020 and investigates influencing factors of peer effect. The main findings are as follows. First, there is a peer effect in making green innovation decisions. Second, industry competition has a positive moderating effect on the peer effect of green innovation. Third, digital financial inclusion and government intervention both promote the peer effect of green innovation. The peer effect is more significant with a high degree of digital financial inclusion. But the peer effect has no significant difference between different degrees of government intervention. This paper aims to explore the influencing factors of a firm's green innovation from the perspective of peer effect. The research results can provide a guide for the government to better promote green innovation activities of firms and benign competition in the industry. • A firm's green innovation activities are positively affected by industry peers. • Industry competition has a positive moderating effect on green innovation peer effect. • Digital financial inclusion and government intervention both promote the peer effect. • The peer effect is more significant with a high degree of digital financial inclusion. • The peer effect has no significant difference between different degrees of government intervention. [ABSTRACT FROM AUTHOR]

Transparent environmental information is fundamental for the government to better regulate pollution and for the public to be aware of pollution. However, how the improvement of environmental information transparency affects firms' environmental behavior has been underexplored. This paper fills this gap by exploring the impact of China's air quality monitoring and disclosure program on the green innovation of firms; via this program, real-time air quality monitoring stations have been constructed nationwide, and the information is promptly released to the public. The results of a difference-in-differences estimation show that the information program has significantly increased the green innovation of firms, especially the number of green invention patent applications. Moreover, this increase is realized via the regulatory effect of both the local government and public attention. Additionally, the green innovation effect performs stronger in state-owned enterprises (SOEs) and firms in heavily polluting industries. This paper contributes to the related literature from the perspective of central government-led real-time transparent environmental information disclosure. The findings of this study highlight policy implications from the perspective of the importance of the application of information technology in environmental regulation, as well as the vital role of information-based instruments in exerting a public regulatory effect on environmental governance. • Effect of pollution information disclosure on firm's green innovation is tested. • DID is used exploiting China's Air Quality Monitoring-and-Disclosure Program. • The pollution information disclosure significantly boosts firm' s green innovation. • The mechanism is the regulatory effect from local governments and public attention. • Porter's Hypothesis is supported from the new view of information disclosure. [ABSTRACT FROM AUTHOR]

Energy-intensive industries are a priority for achieving low-carbon economic growth in China, and a large number of government R&D subsidies have been injected into energy-intensive firms to support green innovation in recent years. Most of the existing literature has studied the impacts of R&D subsidies on the general innovation of high-tech firms or emerging enterprises. This paper explores the impacts of government R&D subsidies on the green innovation of energy-intensive firms. By employing propensity score matching with 527 samples of listed companies from 2010 to 2015, the empirical results show that government R&D subsidies increase the green innovation of energy-intensive firms, specifically their tendency and performance, by 107.3% and 54.1%, respectively. Heterogeneity analyses show that the impact is stronger in state-owned enterprises and in small and medium enterprises. Finally, some practical implications are put forward that may help to improve the efficiency of government R&D subsidies and promote the green innovation of energy-intensive firms. • The impacts of government R&D subsidies on the green innovation of energy-intensive firms are analyzed. • The firm-level impacts are investigated. • The firm-level impacts are investigated.Government R&D subsidies significantly increase the green innovation tendency and performance of energy-intensive firms. • The impact is stronger in state-owned enterprises and in small and medium enterprises (SMEs). [ABSTRACT FROM AUTHOR]

Under the goal of "carbon peaking" and "carbon neutrality" in China, it is significant to explore whether green finance contributes to carbon emission reduction. Therefore, based on the panel data of 30 provinces in China from 2005 to 2020, this paper empirically examines the impact of green finance on carbon emissions and its mechanism using the FE model, GMM model, DID, and the mediating effect model. Results find that green finance can significantly promote carbon emissions reduction, and this promotion remains still after robustness tests. The heterogeneity analysis shows that green finance's carbon emission reduction effect is more significant in developed and western regions. Moreover, the results of policy intervention effects confirm that green finance reform and innovation pilot zones (GFRIs) for carbon emission reduction are more pronounced than in other regions. Finally, the mediating effects reveal that industrial structure and green innovation are the core transmission channels through which green finance influences carbon emission reduction. These findings offer meaningful implications for formulating reasonable carbon emission reduction plans and determining the future development direction of green finance. [ABSTRACT FROM AUTHOR]

Transportation infrastructure plays a fundamental role in reducing pollution emissions to avert global environmental degradation. However, the mechanisms behind these effects remain unclear. This paper aims to provide empirical evidence by investigating the effects of roads on the intensity of air pollutant emissions. Using a city-level data set for the period 2003–2015, we find that roads help to reduce the intensity of pollution emissions in China and induce greener growth performance. Specifically, we test two possible mechanisms through which roads improve environmental performance, and the results suggest that roads have a more positive and significant impact on air pollution reduction when an eco-industrial park is located in a nearby city. There is also evidence that roads can spur green innovation and hence can contribute to regional green performance. • We use city level data to examine transportation infrastructure's effect on air pollution in China. • We propose two possible mechanisms to confirm the effect of transportation infrastructure. • Transportation infrastructure plays an important role in reduction of air pollution emission. • The implications of policy in emerging economies are discussed. [ABSTRACT FROM AUTHOR]

Green innovation and pollutant emissions are currently among the hottest topics in corporate environmental behavior (CEB) research. However, a few previous studies have examined these two concepts together at the choice level of CEB. This paper discusses the internal selection logic of CEB by using multinomial logit (MNL) models that consider the choices of enterprises in green innovation and illegal emissions, both across China and separately in different regions. The objective of this paper is to consider the four choices available to heavily polluting enterprises' dual-target corporate environmental behavior (DTCEB), including alienated, conservative, contradictory, and intimate environmental behaviors. The results of this study show that, under various external pressures, 61.2% of heavily polluting enterprises choose conservative environmental behavior. There is also generally a lack of synchronization between the goals of short-term economic and long-term social benefits. At the current stage, environmental regulation measures should focus on guiding enterprises to change from alienated, conservative, and contradictory behaviors, to intimate. Instead of only focusing on monitoring pollution emissions, the government should focus on green innovation guidance to effectively promote the transformation and upgrading of heavily polluting enterprises. A moderate adjustment of the intensity of command regulation may lead to better regulatory effects. Specifically, the enforcement of laws across China should be slowed; efforts should be made to increase the focus of public participation in the eastern region; the importance of incentive-based tax rate preferences should be increased in the central region, and the intensity of legislation should be strengthened in the western region. Compared with the emphasis on environmental performance in other literature, this article uses comparative thinking to explore the choice logic of the DTCEBs, which attaches different degrees of importance to long-term social benefits and short-term economic benefits. [ABSTRACT FROM AUTHOR]

The value of green innovation on achieving sustainable development is increasingly recognized in recent years. This paper explores whether and how external institutional pressure (including coercive pressure, normative pressure and mimetic pressure, though the last was not discussed in depth) promote green innovation and investigates the moderating effect of internal organizational slack by combining institutional theory and resource-based view. With the sample of China's top 100 listed companies from 2008 to 2014 and generalized estimating equations (GEE) approach, the findings supports the Porter Hypothesis that both coercive pressure and normative pressure have significant positive effects on corporate green innovation. Organizational slack positively moderates the relationship between coercive pressure and green innovation, but has no significant impact on the relationship between normative pressure and green innovation. Accordingly, the scientific value of this research is that it extends the debates on Porter Hypothesis and the role of organizational slacks. The results suggest that the government should strengthen the implementation of coercive tools, the media should play roles of “muckraking”, “catalyst” and the “vanguard” of public inquiry to insert normative pressure, and firms should rationally allocate slacks to improve green innovation. [ABSTRACT FROM AUTHOR]

The dual-credit policy is expected to achieve subsidy policy withdrawal through the effective market-oriented mechanism of credit trading, which has both rewards and sanctions for auto firms. The policy can activate the endogenous motivation of automakers to conserve energy and cut carbon emissions, which aids in creating a long-term mechanism to foster the growth of the auto industry. This paper examines the impact of the dual-credit policy on the quantity and quality of green innovation in auto firms using the difference-in-differences (DID) model. Based on the data of listed firms in the auto industry in the China A-share market from 2014 to 2020, we discover that the DCP-assessed auto firms' green innovation performance improves significantly after implementing the DCP. By analyzing the mediating effect, we identify that the dual-credit policy enhances corporate environmental responsibility and R&D investment, thus improves their green innovation performance. Further, the role of the dual-credit policy in enhancing green innovation increases significantly with the weakening of government environmental subsidies and the strengthening of government environmental penalties. Our findings expand the research on the implementation effects of the dual-credit policy and policies combining environmental regulation and market incentives. We emphasize the importance of the dual-credit policy in furthering the reform of the energy consumption structure and building a green innovation system that is focused on the market, and we propose that the government play a complementary role with the market through reasonable regulation and supervision. • The dual-credit policy (DCP) can improve auto firms' green innovation. • The corporate environmental responsibility and R&D investment are primary mechanisms for improvement of green innovation. • Government subsidies dampens the green innovation-enhancing effect of the DCP. • Government environmental penalties promotes the green innovation-enhancing effect of the DCP. [ABSTRACT FROM AUTHOR]

The growth effect of collaborative agglomeration of manufacturing and producer service industries is receiving increasing attention from scholars. However, few studies have explored whether and how collaborative agglomeration of manufacturing and producer service industries affects green innovation. To bridge this gap, using the methods of the system generalized method of moments, the moderating effect, and the threshold effect, and employing the panel data of 30 provinces of China for 2003–2017, this paper studies the effect of industrial collaborative agglomeration on green innovation and how this influence fluctuates when marketization is included. The main findings are as follows: (1) During the sample period, industrial collaborative agglomeration generally had a blocking effect on China's green innovation. A 1% increase in industrial collaborative agglomeration indicated a 0.461% decrease in green innovation efficiency. (2) Marketization can be an essential and efficient factor to correct the negative impact of industrial collaborative agglomeration through a moderating effect. (3) With the improvement of marketization, industrial collaborative agglomeration exhibits a U-shaped effect on green innovation, with the turning point occurring when the marketization index is 6.21. (4) As of 2017, 21 provinces have successfully exceeded the threshold of marketization, indicating that the current industrial collaborative agglomeration has been able to effectively improve China's green innovation efficiency. However, the other nine provinces still trail behind them in marketization reforms, with industrial collaborative agglomeration continuing to negatively affect green innovation. (5) This paper concludes with recommendations to improve green innovation through industrial collaborative agglomeration and market reform. Image 1 • Our research model links marketization, green innovation and industrial collaborative agglomeration. • We explore whether and how industrial collaborative agglomeration affects the green innovation. • Marketization moderates and promotes industrial collaborative agglomeration's influence on green innovation. • As marketization deepens, industrial collaborative agglomeration's effect on green innovation shows a U-shaped curve. [ABSTRACT FROM AUTHOR]

Governments often turn to subsidies to boost enterprises' innovation activities, which gives subsidized enterprises room for allocating the subsidies among different innovation activities. Taking insights from institutional logic theory, this paper proposes that enterprises exhibit different subsidy-allocation behaviors between nongreen and green innovations and that the positive effect of subsidies on nongreen innovation is greater than that on green innovation due to the double-spillover problem that is pertinent to green innovation. Further, this paper argues that innovation intensity varies from privately-owned enterprises to local and central state-owned enterprises and that the underlying reason for this phenomenon is that enterprises with different ownership structures behave with different institutional logics, face different environmental and innovation pressures, and hold different innovative resource and capability endowments. We test these hypotheses by using longitudinal data (2010–2015) on 175 publicly-traded firms in the pharmaceutical industry in China. Overall, the results support most of the hypotheses. • The effects of governmental subsidies on green and nongreen innovations were examined. • The moderating role of ownership types between innovation subsidies and green/nongreen innovation was examined. • Five-year panel data from 175 publicly traded Chinese pharmaceutical firms were used to test the hypotheses. [ABSTRACT FROM AUTHOR]

In this paper, a model for the slacks-based measure of super-efficiency in data envelopment analysis (SBM-DEA) was used to measure the green innovation efficiency (GIE) of 79 cities in the Yellow River Basin (YRB) from 2003 to 2018. In addition, the panel threshold model was employed to test the nonlinear relationship between environmental regulation intensity (ERI) and GIE. According to the results, the average GIE in the YRB was 0.68. However, the GIE exhibited a rising and fluctuating temporal trend and the following spatial trend: "lower reaches > upper reaches > middle reaches." Moreover, ERI had a double threshold effect on GIE in the YRB. That is, ERI had a significant positive impact on GIE only when ERI ranged between 0.595 and 0.899. Furthermore, the upper, middle, and lower reaches of the YRB exhibited different nonlinear correlations between ERI and GIE. Therefore, it is essential to implement environmental regulations that are appropriate for the actual conditions of each region. In addition, the per capita income, teacher resources, industrial structure, and actual utilization of foreign capital are significant factors affecting GIE in the YRB. These findings can help governments formulate suitable environmental policies and promote green innovation in the YRB, thereby contributing toward the goal of global sustainable development. • The efficiency of green innovation in the Yellow River Basin increases. • The efficiency of green innovation shows a spatial pattern of "lower reaches > upper reaches > middle reaches". • Regulations have a double threshold effect on the efficiency of green innovation. • The efficiency of green innovation must be improved based on the actual development of each region. [ABSTRACT FROM AUTHOR]

This paper provides an in-depth understanding of the mechanisms of green finance on green innovation, focusing on their spatial and non-linear relationships. Using panel data of 30 provinces of China during the period of 2009–2017, a green finance index is constructed, and the spatial Durbin model and panel threshold model are used. The results reveal that: (1) Green finance and green innovation had significant positive autocorrelation, and the development of green finance in provinces of central and western China were still in the lower-level range. (2) The coefficients of the direct effect and indirect effect of green finance on green innovation were significantly positive, which indicated that green finance was conducive to enhancing green innovation in local and adjacent provinces during the research period. (3) Double threshold effects of green finance on green innovation were observed, which demonstrated that the driving effect of green finance was decreased with the raising of intensity of environmental regulation. The implication of these results is that government should make full use of the radiation and trickle-down functions of green finance and green innovation to narrow regional gaps in sustainable development while maintaining a moderate intensity of environmental regulation. • A green finance index of 30 provinces of China during the period of 2009 to 2017 was constructed on the basis of green credit, green securities, green insurance, and green investment. • The heterogeneity of region and time for green finance were analyzed employing the spatial exploratory analysis, which manifested that the spatial evolution of green finance in China presents a gradient decreasing pattern from east to west. • The impact of green finance on green innovation was explored by the spatial Durbin model, which proved that the direct effect and the spatial spillover effect were significantly positive. • Moderate intensity of environmental regulation helps green finance promote green innovation and this value should not exceed a maximum of 0.935. [ABSTRACT FROM AUTHOR]

China has incorporated green technology innovation into its national development strategy based on its national conditions and development needs. The emission permit system is a typical environmental regulation, and one of the driving forces of green technology innovation. Research into the pollution discharge permits system is a key for improving environmental regulations. This study seeks to investigate the impact of pollution permits system on green innovation in China. Using econometric methods, we constructed and tested the model of green technology innovation incentives based on the emission permits system, and applied it to several Chinese counties and districts. The results revealed shortcomings in implementation of the emission permits system in various counties and districts. From a governmental perspective, this was due to poor standardization of management processes and insufficiently innovative supervisory methods. On the corporate side, problems included poor auditing of law enforcement plans, poor implementation of the ledger system, and a lack of disclosure of pollution data. We propose comprehensive strategies to address these issues. This paper explores the emission reduction potential of the pollution discharge permits system at the county level, in accordance with the Porter hypothesis, and provides reference data for the formulation and optimization of energy conservation and emission reduction policies. This will promote green development of the chemical and other industries, and green technology innovation in China. • We explore the pollution discharge permits system at the county level. • We construct a model of the impact of pollution discharge permits system. • We put forward some strategies for promoting green technology innovation. [ABSTRACT FROM AUTHOR]

In this paper, we explore the effects of China's green credit policy on highly polluting enterprises' green radical and incremental innovations. Utilizing the data of China's listed firms from 2007 to 2019, the empirical results show that green credit policy improves the overall and incremental green innovations but impedes the radical green innovation of highly polluting enterprises. Local governments' interventions, including direct intervention and environmental investment, not only mitigate the negative impact of the policy on radical innovation but also facilitate the positive effects. Our findings provide suggestions for the implementation of China's green credit policy. [ABSTRACT FROM AUTHOR]

In recent years, corporate green innovation has become a hot topic in society and academia, but the relationship between green innovation and financing conditions is less frequently discussed. Based on stakeholder theory, this paper explores whether green innovation can alleviate corporate financing constraints. An empirical test using a sample of Chinese non-financial private enterprises listed in the Shanghai and Shenzhen exchange from 2012 to 2017 is established. The results of regression analyses show that green innovation, including green technology innovation and green management innovation, can significantly reduce the financing constraints of enterprises. Moreover, the interaction between corporate environmental disclosure and green innovation can have a positive effect, further improving the financing conditions of firms. These findings remain valid after endogenous and robustness testing including instrumental variables (IV), propensity score matching (PSM) and updated models. Additional research illustrates that green innovation plays a stronger role in alleviating financing constraints among heavily polluting enterprises. The above findings contribute to the literature concerning green innovation and corporate financing and provide a valuable reference for implementing green innovation, improving the financing environment and policy making. Image 1 • Green innovation, including green management innovation and green production innovation, can significantly reduce corporate financing constraints. • Environmental disclosure can alleviate the financing constraints of enterprises. • The interaction of corporate environmental disclosure and green innovation can have a positive effect, further improving the financing conditions of firms. • The green innovation of heavy polluters can better reduce financing constraints. [ABSTRACT FROM AUTHOR]