The Impact of Media Sentiment on Corporate Green Innovation: Evidence from Heavily Polluting Enterprises in China

As an external force in corporate governance, the media exerts significant influence on firm behavior, while green innovation (GI) represents a vital determinant for heavily polluting enterprises in pursuing sustainable growth. This study investigates how media sentiment affects green innovation in such firms. Drawing on data from Chinese A-share listed companies in heavily polluting industries covering 2007–2023, this article provides evidence that media sentiment serves as a crucial driver of corporate GI. Specifically, positive media sentiment can encourage firms to expand R&D investment and attract institutional investors to hold shares, thereby promoting green innovation. Heterogeneity analysis reveals that the impact is stronger among state-owned enterprises, companies with superior internal control quality, and those situated in the central and eastern regions. Further analysis indicates that the effect exhibits persistence, remaining significant for four years. In addition, media sentiment shows asymmetrical effects on green innovation. Positive sentiment contributes to enhancing both its quantity and quality, whereas negative sentiment only suppresses its quality, leaving quantity unaffected.