Chain leader policy and corporate green innovation—Perspectives of financing constraints and risk-taking

Chain leader policy is a key initiative recently implemented by the Chinese government to promote green development. Green innovation is not only essential for achieving environmental sustainability but also serves as a critical driver of long-term economic growth. In this study, we use a large sample of firms listed on the Chinese A-share market to examine the impact of chain leader policy on corporate green innovation. The baseline results indicate that the policy is positively associated with corporate green innovation. These findings are robust across a range of sensitivity tests. Moreover, channel analyses reveal that chain leader policy promotes green innovation by alleviating financial constraints and encouraging corporate risk-taking. Cross-sectional analyses further show that the positive effect of chain leader policy is more pronounced in state-owned enterprises, firms exposed to higher supply chain risk, firms facing greater environmental uncertainty, and enterprises in heavily polluting industries. This study offers valuable insights for both policymakers and businesses by underscoring the role of chain leader policy in advancing green innovation and providing practical guidance for enhancing corporate sustainability and tackling environmental challenges.