Green manufacturing and corporate ESG performance: quasi-natural experiments in green factory certification policy

Abstract This study focuses on the effects of China’s green factory recognition policy on corporate environmental, social, and governance (ESG) disclosure and its role in curbing greenwashing behaviour. By constructing a multiperiod double-difference model with the unbalanced panel data of China’s Shanghai and Shenzhen A-share listed companies from 2007 to 2022 and using the green factory recognition policy implemented in China from 2017 to 2022 as a policy intervention, we research the relationship between the policy implementation and enterprises' ESG ratings and comprehensively analyse its potential inhibitory influence on greenwashing behaviour. Results show that the implementation of the green factory recognition policy considerably enhances firms’ ESG ratings, and the policy works through mechanisms, such as promoting green technology innovation, enhancing media attention, and reducing credit costs. The implementation of the policy also effectively inhibits the greenwashing behaviour of enterprises. Heterogeneity analysis further reveals the different response effects of ownership structure, industry attributes, and firm life cycle stages on the influence of this policy. Our study provides new evidence and has reference value for the implementation of voluntary ESG policies and the construction of green manufacturing systems.