Retail investor activism and corporate environmental investments: evidence from green attention

Xiaofei Li, Weian Li, Jian Xu, Lixiang Wang
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Abstract

PurposeThe purpose of this study is to examine the role of retail investors’ green attention in promoting corporate environmental investments (EIs) using a communication sample on “Hudongyi” from 2011 to 2022.Design/methodology/approachIn this paper, Python is used to capture data and text analysis techniques to obtain green attention information. In the word-matching process, words are matched in the target document one by one based on the preset dictionary and vocabulary rules. In addition to employing fixed effects, this study also incorporates instrumental variables using two-stage least squares (2SLS) estimation and applies the Heckman two-step method to verify the regression results.FindingsFirst, this paper empirically examines the positive influence of retail investors’ green attention on EIs. Second, the findings show that retail investors’ green attention promotes EIs through decreasing principal-agent costs and principal-principal costs. Third, the results show that retail investor’s supervision effect is strengthened under the following three circumstances: executives with stronger green conception, corporations with less information asymmetry and areas with higher level of investor protection.Practical implicationsOur findings broaden the scope of prior research by exploring the impact of retail investor activism on nonfinancial outcomes, contributing to understanding the “black box” of how investor attention fosters EIs. Moreover, by leveraging the power of technology, retail investors have evolved from being the “silent majority” to being actively engaged. The internet has empowered retail investors by providing them with access to information and enabling them to exercise “voice” rights by appealing companies to engage in pro-environmental activities. Our study can provide useful suggestions for the green development of listed companies in China, as well as in other emerging countries.Originality/valueUnlike other studies that focus on the deterrent effect and corporate financial outcomes of retail investors, we focus on the supervisory effect of retail investors and verify its role in driving EIs. This fills the knowledge gap in prior studies and contributes new insights to explain EIs and extends the understanding of retail investor activism.
散户投资者行动主义与企业环境投资:来自绿色关注的证据
本研究的目的是以 2011 年至 2022 年 "沪东亿 "的传播样本为研究对象,探讨散户投资者的绿色关注在促进企业环境投资(EI)中的作用。在词语匹配过程中,根据预设的词典和词汇规则对目标文档中的词语进行逐一匹配。除了采用固定效应外,本研究还利用两阶段最小二乘法(2SLS)估计纳入了工具变量,并运用 Heckman 两步法验证了回归结果。第二,研究结果表明,散户投资者的绿色关注通过降低委托代理成本和委托人与委托人之间的成本来促进企业投资。第三,研究结果表明,散户投资者的监督效应在以下三种情况下会得到加强:高管绿色理念较强、企业信息不对称程度较低以及投资者保护水平较高的地区。此外,通过利用技术的力量,散户投资者已从 "沉默的大多数 "演变为积极参与。互联网为散户投资者提供了获取信息的渠道,使他们能够行使 "话语权",呼吁公司参与环保活动。我们的研究可以为中国以及其他新兴国家的上市公司绿色发展提供有益的建议。原创性/价值与其他关注散户投资者的威慑效应和公司财务结果的研究不同,我们关注散户投资者的监督效应,并验证其在推动环境投资中的作用。这填补了以往研究的知识空白,为解释 EI 提供了新的见解,并扩展了对散户投资者积极性的理解。
本文章由计算机程序翻译,如有差异,请以英文原文为准。
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