Yuanzhe Huang

China’s economy has achieved significant success by integrating itself into the globalized production system over an extended period. However, it is crucial to address the environmental consequences that accompany rapid economic progress. The correlation between trade and environmental pollution is still controversial in the existing literature, with a lack of research specifically investigating this relationship using detailed data at the firm level. Based on the quasi-natural experiment of China’s accession to the WTO, this study uses the DID method to evaluate the causal relationship between trade and the environment experimentally. It is found that trade liberalization significantly increases firms’ industrial wastewater emissions, and the empirical results remain robust after parallel trend tests, placebo tests, and replacement variables. The mechanism of action suggests that trade expansion enhances corporate pollution emissions through two channels: attracting foreign investment into the country and intensifying energy consumption. A heterogeneity analysis reveals that the pollution-enhancing effect of trade expansion on enterprises is mainly concentrated in export-oriented enterprises, labor-intensive industries, and coastal regions. Additionally, further analysis shows that trade liberalization not only has local impacts but also spatial spillover effects on enterprise pollution. It is found that enhancing environmental governance and reducing corruption can effectively mitigate the adverse environmental consequences caused by trade liberalization.

Along with command-and-control and market-incentive environmental regulation policies, environmental information disclosure (EID) is an important measure used by the Chinese government to implement environmental governance. In the context of advocating for corporate sustainable development and green governance, this study uses data from China’s Shanghai and Shenzhen A-share listed companies in heavily polluting industries spanning 2008–2019 to empirically explore the relationship between corporate EID and green innovation (GI). The results reveal the following: (1) high-quality EID significantly promotes the absolute GI level and the relative GI level of enterprises. (2) An intermediary model found that the internal mechanism of corporate EID used to promote GI mainly comes from the government’s energy-saving innovation subsidy effect and the social media attention effect. (3) Corporate EID has a more evident promotional effect on green patents for energy conservation and green patents for inventions. (4) The EID of state-owned enterprises is more conducive to GI than to the activities of private enterprises. (5) The EID of enterprises in high-level administrative cities has no significant impact on GI. However, it has a significant promoting effect in low-level administrative cities. The research not only provides an empirical basis for China to improve the environmental information disclosure system of listed companies but also to offer guidance for companies to pursue green and sustainable development.