The Impact of Innovation Adoption on Sustainable Business Development in China: the Role of Environmental, Social, and Corporate Governance Performance

Abstract

ESG as a phenomenon appears to be consistent with high quality development of economy of country like China, hence, implementation of ESG is essential to embrace sustainability. Thus, it is imperative to scrutinize the its effectiveness and, in this lieu, the study attempts to scrutinize the effectiveness of innovation adoption on the environmental, social and governance performance, and SBD of the electric vehicle industry in the context of China. Along with it, mediating role of ESG performance has also been explored in the study. Primary data was collected for the study and PLS-SEM methodology was used to evaluate the collected data. Results showcase that innovation adoption is positively correlated with ESG performance and SBD of the electric vehicle industry in China. The outcomes also exposed that the ESG performances significantly mediates the relationship between innovation adoption and SBD. In the light of the evidence, the analysis recommends that organizations must value their ESG performance in order to formulate relatable policies.