Increasingly serious environmental pollution has become an important factor restricting the sustainable development of China's economy and society (Li and Ramanathan, 2020; Zhang et al., 2022). Enterprises are the main consumers of resources and producers of environmental problems, 80% of the total social pollution in China is caused by the production and operation activities of enterprises. Integrating environmental factors into financial decisions such as capital investment can resolve the conflict between profitable growth and environmental protection. As a special manifestation of corporate social responsibility, green investment in enterprises is the key for enterprises to achieve sustainable development and maximize social value ( Indriastuti et al., 2021; Fu et al., 2022). The "2021 A-Share Listed Company Corporate Social Responsibility Report Research" shows that 992 A-share listed companies that disclosed corporate social responsibility reports have shown a clear upward trend in their investment in environmental protection. In order to cope with external supervision and establish a green image, the original intention of corporate green investment is not limited to reducing environmental pollution. The ECGI is the objective feedback on the effectiveness of corporate pollution prevention and control.
Government regulation is the main driving force of corporate environmental behavior. As the feedback on the effect of corporate environmental practice, the ECGI is bound to be affected by government environmental regulation (Huang and Lei, 2021). The key to motivating companies to participate in environmental governance is to internalize externalities. In recent years, the green investment of China's heavily polluting enterprises has continued to increase, but its environmental benefits have not been significantly improved. How to improve the ECGI has become the key for heavily polluting enterprises to achieve high-quality development. Therefore, the questions of interest to this paper include three aspects. First, can corporate green investments effectively improve environmental performance? Second, can environmental regulation effectively promote the ECGI? Are there differences between different types of environmental regulation tools? Finally, what is the impact mechanism of different types of environmental regulations on the ECGI?
The literatures related to this paper focus on the relationship between environmental regulation and corporate green investment and corporate environmental performance. Regarding the research on the impact of environmental regulation on corporate green investment, scholars have formed three views. The first view is that strengthening environmental supervision can stimulate enterprises to increase investment in environmental protection, which is in line with the "legitimacy" hypothesis (Liao and Shi, 2018; Wang et al., 2022). Another view is that environmental regulation fails to promote green investment by enterprises effectively, but instead led to the migration of enterprises to areas with loose environmental regulations (Chen et al., 2018). In addition, some literature points out that there is a “threshold effect” in the impact of environmental regulation on corporate environmental investment (Arouri et al., 2021; Wang et al., 2022 ). In additon, great progress has been made in the research on the impact of environmental regulation on corporate pollution emissions. Some scholars advocate the "reverse forcing effect" and believe that environmental regulation can promote corporate pollution reduction (Du and Li, 2020; Xia et al., 2020). Some literature also believes that the environmental regulation of local governments in China does not have a significant inhibitory effect on pollution emissions, and mainly exerts the "green paradox effect". The reasons for the low efficiency of environmental regulation are mainly due to the special decentralization system and the performance appraisal mechanism centered on GDP. Inefficient environmental regulation increases the possibility of firms seeking rent from local governments, which in turn leads to increased pollution emissions (Zhang et al., 2021).
There are few studies combining green investment and environmental performance. Chen and Feng (2021) proposed the concept of green investment efficiency, which combined the green investment and environmental performance of enterprises, and found that the impact of the implementation of environmental regulations on the green investment efficiency of enterprises was in an inverted "U" shape. Similarly, Li et al. (2019) calculated the environmental governance efficiency of Chinese steel companies. They analyzed the different effects of two environmental regulations on the efficiency of Chinese corporate environmental governance. The results show that there is heterogeneity in the impact of different types of environmental regulations on the efficiency of environmental governance. The relationship between market incentive environmental regulation and environmental governance efficiency is inverted U-shaped. Command-and-control environmental regulation is positively correlated with the efficiency of environmental governance but not significantly. While the existing literature has achieved fruitful results, some issues still need to be further explored. Firstly, heterogeneous environmental regulation has a differentiated impact on corporate managers' decision-making. Environmental regulation mostly focuses on factors at the national and regional levels. There is a lack of examining the relationship between the two from the perspective of corporate response.
Secondly, some literature have examined the relationship between environmental regulation and the ECGI, but they are limited to the empirical relationship between the two. Few literature has theoretically analyzed the impact mechanism of environmental regulation on the ECGI, and based on this, China's empirical evidence has been sought. Therefore, the contribution of this paper to the existing research is mainly reflected in the following two aspects. First, this paper examines the impact of heterogeneous environmental regulations on the ECGI from the perspective of companies responding to environmental regulations. It provides a new micro perspective for the debate on environmental regulation and enterprise green transformation and extends Porter's Hypothesis. Second, this paper discusses the "forcing" effect of the environmental tax on the ECGI, and the "crowding-out effect" of environmental protection subsidies on the ECGI. Through theoretical analysis, this paper expounds the different impact mechanisms of different types of environmental regulations on ECGI, helping to deepen the research on environmental regulation and micro-corporate behavior.
This paper was organized as follows. Section 2 presented the theoretical mechanism. Section 3 introduced the methodology and data. Section 4 displayed the results and discussions. The last section summarized conclusions, policy implications and limitations.