The Erosion Effect of Green Governance Opportunism on Firm Green Value

This article explores the impact of green governance opportunism as the phenomenon when companies shift their focus to the environmental objectives significantly and at the same time neglect social accountability and corporate governance. Based on panel data on Chinese 1843 listed companies over 2010–2022 and a nonlinear regression model, we find an inverted U-shaped relationship between this opportunism and firm green value. Initially, such actions assist companies to achieve legitimacy benefits; however, after a particular level, they start eroding green value. What drives this pattern is a shift in innovation priorities: opportunistic firms increasingly favor strategic green innovations that deliver short-term payoffs over substantive ones that build lasting competitive advantage. In order to represent this distortion, we analyze three specific mechanisms through which the erosion occurs. The first is symbolic green innovation, which prioritizes image over genuine environmental improvement. The second takes the form of intermittent green innovation, marked by frequent starts and stops that prevent cumulative learning. The third is displaced green innovation, where firms substitute their own R&D efforts with externally acquired technologies. The results also indicate that patient capital may reduce these distortions by decoupling opportunism from the above three innovation models, thereby alleviating the value erosion effect of green governance opportunism. These reveal the adverse impact of imbalanced corporate governance on sustainable development, and provide practical insights for managers, investors and regulatory authorities.