Low-carbon Management, Internal Control, and Innovation of State-owned Enterprises in China

Purpose Innovation is key for state-owned enterprises to realize the optimization, adjustment, and upgrading of their industrial structure. Both government supervision and internal control could impact the implementation of innovation strategies of state-owned enterprises. We empirically tested low carbon operations management and the role of internal control systems in state-owned enterprise innovation, as well as influence mechanisms. Design/Methodology/Approach This paper takes State-owned A-share listed enterprises in the Shanghai and Shenzhen stock exchanges from 2009 to 2017 as research panel data, and based on corporate governance theory constructs fixed effects models, and conducts analysis using SAS9.4 software for empirical research. Findings We found a significant positive correlation between internal control and state-owned enterprise innovation, which can improve input intensity and effectively guarantee the innovation output. There is a significant positive correlation between low-carbon management and innovation of state-owned enterprises which can improve the intensity of innovation input and significantly promote innovation output. Research Implications Our results reveal that low carbon operations have a regulating effect on the relationship between internal control and state-owned enterprise innovation. Under the environment of low-carbon management, enterprises can perfect the supervision mechanism of their internal control system and improve their innovation ability. KCI Citation Count: 0