How Does Spousal Co‐Governance Affect Environmental Innovation in Family Firms? The Role of Knowledge Sources and Second‐Generation Involvement

ABSTRACT Family firms play an irreplaceable role in ecological environmental protection and high‐quality economic development. Grounded in socioemotional wealth theory, this study explores the impact of spousal co‐governance on environmental innovation in family firms, as well as the mediating role of knowledge sources and the moderating role of second‐generation involvement. Using a sample of Chinese A‐share listed family firms from 2011 to 2022, a multiple regression model was employed to empirically test the hypotheses. The spousal co‐governance model was found to promote environmental innovation in family firms, with the breadth and depth of knowledge sources playing a partial mediating role. Second‐generation involvement negatively moderates the positive relationship between spousal co‐governance and environmental innovation in family firms. Further analysis reveals that the promoting effect of spousal co‐governance on family firms' environmental innovation is stronger in regions with lower divorce rates and higher levels of intellectual property protection. The involvement of relatives from both sides of the family in corporate management hinders family firms' environmental innovation.