How Does Patient Capital Drive Green Innovation?—Evidence from Chinese Listed Companies

Green innovation is a key driver of green and low-carbon industrial development against the backdrop of the carbon peaking and carbon neutrality targets. Characterised by a long-term value orientation and strong risk-bearing capacity, patient capital can underpin improvements in corporate green innovation capacity. The existing literature focuses predominantly on equity-based patient capital, whereas few studies explore how debt-type patient capital shapes corporate green innovation capacity. Using a sample of Chinese A-share firms listed on the Shanghai and Shenzhen Stock Exchanges from 2014 to 2024, this paper empirically investigates the impact and underlying mechanisms of debt-type patient capital on corporate green innovation capacity. The results show that debt-type patient capital exerts a positive effect on corporate green innovation capacity. Mechanism tests further reveal that debt-type patient capital facilitates corporate green innovation capacity through the channels of relational embeddedness in director networks and operating risk. The heterogeneity analysis shows that the capacity-enhancing effect of debt-type patient capital on green innovation is more pronounced for state-owned enterprises and firms in heavily polluting industries. This study elucidates the transmission mechanisms linking debt-type patient capital to corporate green innovation capacity, and provides theoretical insights and practical implications for firms aiming to enhance their green innovation performance.