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ORIGINAL RESEARCH
The Impact of the Carbon Emissions
Trading Policy on the Corporate ESG
Performance – Evidence from China
1
School of Economics and Management, Tianjin Agricultural University, Tianjin, China
2
School of Accounting, Shandong University of Finance and Economics, Jinan, China
Submission date: 2024-06-24
Final revision date: 2024-08-10
Acceptance date: 2024-10-07
Online publication date: 2025-01-27
Publication date: 2025-11-04
Corresponding author
Pol. J. Environ. Stud. 2025;34(6):7921-7932
KEYWORDS
TOPICS
ABSTRACT
Based on a sustainable development perspective, this study examines the impact of China’s
carbon emissions trading policy on corporate environmental, social, and corporate governance (ESG)
performance. Data from 845 listed companies in China from 2011 to 2020 are used, and differences-indifferences
(DID) and triple-difference models are adopted. The empirical results show that implementing
carbon emissions trading policies significantly enhanced corporate ESG performance. According to
the triple-difference model, as internal drivers, two different corporate sustainability indicators focus
on different moderating roles in the relationship between carbon emissions trading policy and corporate
ESG performance. The external driving factor (i.e., the regional digital economy’s development level)
positively moderates the relationship between carbon emissions trading policy and corporate ESG
performance. Further analysis shows that larger companies and state-owned enterprises achieve more
significant improvements in ESG performance under carbon emissions trading policy.
CONFLICT OF INTEREST
The authors declare that they have no known competing financial interests or personal relationships that could have appeared to influence the work reported in this paper.
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