How does a government-certificated green identity improve enterprises' market value?

Abstract

This study analyzes the correlation between the government-certificated green identity and enterprises' market value from 2016 to 2023. The results indicate that the government-certificated green identity significantly promotes enterprises' market value improvement, mainly through reinforcing stakeholder trust and optimizing capital allocation efficiency. The analysis reveals heterogeneous effects influenced by organizational characteristics—non-state-owned, small-size firms and firms in heavily polluted industries benefit more from acquiring green identity. The results indicate that market incentives for decarbonization pledges depend on an organization's capacity to transform sustainability signals into operational solutions. The evidence establishes ecological authentication as a matter of regulatory compliance and a competitive differentiator in capital markets, especially for enterprises facing resource limitations while aligning environmental governance with investor expectations.