Author(s)

Cheng Feng ¹, Tianzeng Wang ²

Affiliation(s)

¹ School of Business, Hunan University of Science and Technology, Xiangtan, 411201, China
² School of Management, College of Modern Science and Technology, China Jiliang University, Yiwu, 322002, China

Corresponding Author

Cheng Feng

ABSTRACT

This paper explores the impact of managerial capability on green innovation. The study finds that the profitability of managers limits the development of enterprise green innovation capability, mainly due to managers' short-sighted behavior and compensation systems that prioritize income. To correct decision biases, shareholders can take measures to encourage management to reconsider the company's long-term development. Equity incentives can reduce the short-term behavioral risks of managers and increase the company's investment in green innovation. In addition, in regions with lower levels of marketization, the negative impact of enterprise manager profits on green innovation is more significant. The research results provide valuable theoretical basis and empirical evidence for the analysis of enterprise heterogeneity. Policy recommendations include establishing a comprehensive and universally applicable assessment system for enterprise green innovation capabilities, stimulating the enthusiasm of companies for green innovation, accelerating adaptation to policy environments, and improving investor professionalism and capability.

KEYWORDS

Green Innovation, Fixed Effect Model, Managerial Capability

CITE THIS PAPER

Cheng Feng, Tianzeng Wang, Managerial Capability and Green Innovation. Industrial Engineering and Innovation Management (2024) Vol. 7: 101-112. DOI: http://dx.doi.org/10.23977/ieim.2024.070114.

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