Green factory certification and firms' ESG performance: The moderating role of government intervention and industry competition

As a key policy tool for China's green transformation of manufacturing, the practical effectiveness and scope of green factory certification remain under-examined. This study employs a difference-in-differences approach using data from Chinese A-share listed companies (2012–2023) to systematically investigate the impact of green factory certification on corporate ESG performance and its contextual dependence. The findings reveal: (1) Green factory certification significantly enhances both overall ESG performance and scores across the environmental, social, and governance dimensions, with this effect remaining robust across a series of stability tests; (2) Institutional context significantly moderates certification outcomes—the intensity of government intervention positively moderates the relationship between green factory certification and corporate ESG performance, while industry competition intensity weakens the ESG improvement effect of certification. This study reveals the asymmetric influence of the “government hand” and the “market hand” on corporate environmental behavior in emerging economies. It provides new evidence for understanding the effectiveness of voluntary environmental regulation across different institutional contexts and offers practical insights for governments to optimize green certification system design and for enterprises to formulate differentiated ESG strategies.