Environmental, Social, and Governance (ESG) Performance and New Quality Productivity in China: The Mediating Role of Patient Capital

Abstract

This study addresses a critical gap in the literature by examining the mediating role of patient capital in the relationship between Environmental, Social, and Governance (ESG) performance and New Quality Productivity (NQP) among Chinese enterprises, a strategic priority of national economic policy. Using data from 5,323 Chinese listed companies between 2015 and 2023, the analysis reveals that ESG performance is positively associated with NQP. More specifically, patient capital serves as a key mediator that connects ESG performance and NQP. The analysis reveals a dual mediation mechanism: strategic equity enhances the ESG–NQP link, while relational debt unexpectedly weakens it, offering new insights into the complex pathways through which ESG influences NQP. Heterogeneity analysis shows that Non-State-Owned enterprises (Non-SOEs) and Specialized, Refined, Distinctive, and Innovative (SRDI) firms exhibit greater NQP gains from ESG adoption, indicating the need for tailored sustainability policies for these enterprise types. This study advances understanding of how patient capital conditions the ESG–NQP nexus, offering novel insights into the financial foundations of sustainable innovation in China.