Managerial attention to environmental protection and corporate green innovation

We examine whether and how managerial attention to environmental protection (MAEP) affects firms' green innovation. Using a sample of Chinese public firms in heavily polluting industries, we find a positive association between MAEP and green innovation. We further find that firms have better green innovation performance when managerial attention is directed towards specific environmental issues rather than broad ones. In mechanism analyses, we find evidence that MAEP promotes green innovation by making more environmental investments and by cultivating environmental awareness within firms. Moreover, MAEP's impact on green innovation is more pronounced when firms have few financial constraints or high-quality internal information environments. Finally, we demonstrate that MAEP promotes firms' high-quality green innovation, that MAEP-induced green innovation can lead firms to lower pollutant discharges in future, and that MAEP's effect on green innovation exists in firms with fewer greenwashing incentives, thus ruling out the greenwashing explanation. Overall, our findings document that increasing managerial attention to environmental protection is vital for non-green firms to initiate successful green practices.