ESG performance and corporate green innovation

We examine the association between listed firms’ environmental, social, and governance (ESG) scores and two dimensions of their green patent portfolios: the number of green patent applications and the proportion represented by green invention applications. Using a sample of Chinese A-share listed firms from 2016 to 2025, we estimate models with firm and year fixed effects and investigate the organisational channels and information conditions associated with this relationship. Higher ESG scores are associated with more green patent applications and a higher invention share. The channel analysis suggests that long-horizon institutional ownership, ISO 14001 environmental management certification, and executives’ attention to green issues are possible organisational channels underlying the association with patent volume. For invention share, the results support the institutional ownership and executive attention channels, while evidence for the environmental management channel is weaker. The associations are more pronounced among large firms, state-owned firms, and firms in heavy-polluting industries. Greater disagreement among ESG rating providers is associated with weaker ESG–patenting relationships for both outcomes, whereas higher environmental information disclosure quality is associated with stronger relationships. These observational findings indicate that the relationship between ESG scores and both the volume and composition of green patenting varies with firms’ organisational characteristics and external information environments.