“Chasing Grade” or “Driving Innovation”? Social Responsibility Grades of Heavily Polluting Enterprises and Exploratory Innovation

The assessment of corporate social responsibility grades offers viable support channels for heavily polluting enterprises to engage in exploratory innovation activities. However, the negative impact of social responsibility grades has received limited attention. The existing studies also have not yet clarified the mechanism by which social responsibility grades affect exploratory innovation. Based on the prospect theory and managerial entrenchment theory, in this article, we use data from 595 Chinese A-share listed heavily polluting firms (3900 firm-year observations) from 2012 to 2019. The study empirically tests the influence of heavily polluting enterprises’ social responsibility grades on exploratory innovation; the mediating effects of managerial entrenchment motivation; the moderating effect of the performance-aspiration gap; the joint moderating effect of ownership characteristics; and performance-aspiration gaps. This study not only provides theoretical and practical guidance for improving the assessment mechanisms that determine the social responsibility grades of heavily polluting enterprises but also has important reference values when it comes to encouraging heavily polluting enterprises to actively carry out exploratory innovation, break the technological blockade, and obtain technological advantages.