Beyond climate risk: corporate biodiversity risk exposure and green technology innovation
Jian Jin, Zhixiang Zhu, Cuifang Wang, Henglang XiePurpose
Biodiversity risk is projected to become the third most significant global risk in the coming decade, attracting substantial attention from policymakers and the public. While existing research predominantly examines climate risks’ impact on corporate decision-making, systematic empirical evidence on how biodiversity risks influence enterprises remains scarce. This study aims to investigate the impact of biodiversity risk exposure on green technology innovation (GTI) in Chinese corporations.
Design/methodology/approach
Using a sample of Chinese A-share listed firms from 2010 to 2023, this study empirically examines the relationship between biodiversity risk exposure and corporate green innovation. It further identifies the underlying mechanisms through investment channels, financing channels, and external supervision channels. Findings: The findings reveal four key insights: First, biodiversity risk exposure significantly enhances GTI, and this positive correlation remains independent of climate risks. Second, mechanism analysis demonstrates that risk exposure drives innovation by weakening profit-seeking motives and increasing R&D investment (investment channel), expanding credit financing (financing channel), and boosting analyst and research report attention (external supervision channel). Third, this effect is particularly pronounced in energy-intensive industries and regions with high carbon emission intensity, and is further amplified by green credit policies. Fourth, deeper analysis indicates that biodiversity risk primarily stimulates substantive innovations with higher technological sophistication, rather than strategic innovations.
Findings
The findings reveal four key insights: First, biodiversity risk exposure significantly enhances GTI, and this positive correlation remains independent of climate risks. Second, mechanism analysis demonstrates that risk exposure drives innovation by weakening profit-seeking motives and increasing R&D investment (investment channel), expanding credit financing (financing channel), and boosting analyst and research report attention (external supervision channel). Third, this effect is particularly pronounced in energy-intensive industries and regions with high carbon emission intensity, and is further amplified by green credit policies. Fourth, deeper analysis indicates that biodiversity risk primarily stimulates substantive innovations with higher technological sophistication, rather than strategic innovations.
Originality/value
This study makes three distinct contributions: First, it expands the research perspective on environmental risks from climate risks to ‘nature-related’ biodiversity risks, providing fresh micro-level evidence. Second, it systematically decodes the “black box” of how biodiversity risks influence innovation by integrating investment, financing, and external supervision channels. Third, it offers critical management and policy insights for transitioning toward high-quality, nature-positive corporate development.