Investor attention, ESG strength, and green innovation efficiency: A two-stage network DEA approach for Chinese listed manufacturers

The escalating environmental degradation and carbon-intensive industrial growth in China highlight a persistent problem of low efficiency in transforming corporate ESG initiatives into tangible green innovation outcomes . Despite the rise of ESG disclosure and green investment policies, many Chinese firms still face inefficiencies in converting sustainability efforts into productive innovation. This study therefore aims to evaluate how ESG strength and investor attention jointly influence the efficiency of green technological innovation among Chinese manufacturing enterprises. Specifically, it seeks to (i) assess the two-stage efficiency of green innovation under ESG constraints, (ii) examine the role of ESG performance in improving both the knowledge-creation and innovation-output stages, and (iii) test the moderating effect of investor attention in enhancing ESG’s contribution to innovation. Using an unbalanced panel of A-share listed manufacturing firms from 2010 to 2024 , a two-stage network Data Envelopment Analysis (DEA) model is constructed to measure green innovation efficiency, complemented by panel regression and moderation analysis to explore the ESG–efficiency–attention nexus. The results reveal that: (1) average green innovation efficiency remains below 0.65, with the knowledge-production stage outperforming the commercialization stage; (2) stronger ESG performance significantly enhances overall and stage-specific efficiency; (3) investor attention amplifies ESG’s positive impact on both stages, serving as an external governance and information channel; (4) state-owned and high-emission sectors demonstrate higher ESG-driven efficiency gains; and (5) robustness tests with alternative efficiency measures and lag structures confirm the stability of results. These findings suggest that integrating ESG governance with capital-market attention mechanisms can substantially improve the quality and productivity of green innovation, offering strategic guidance for China’s dual-carbon transition and sustainable industrial upgrading.