Transformation of innovation in heavily polluting enterprises under resource constraints: The role of green finance policy

This study examines whether the transformation is driven by a “leverage effect” or a “crowding-out effect.” Using data from A-share listed companies from 2010 to 2022 and a difference-in-differences (DID) model, the results reveal that the “Guidelines for Establishing the Green Financial System (GFS)” incentivize enterprises to pursue green innovation by imposing constraints on both debt and equity financing. Grounded in the resource-based theory, enterprises do not develop green innovation in addition to existing innovation activities, but rather achieve it by crowding out other innovation. The policy effect is influenced by supply chain resilience, the degree of digital transformation, and the nature of firm ownership. Further analysis shows that GFS enhances the quantity and quality of green innovation, improving environmental and financial performance. This study provides scientific evidence for policymakers to optimize green finance policy from the perspective of resource constraints.