Government green procurement, technology mergers and acquisitions, and semiconductor firms’ environmental innovation: The moderating effect of executive compensation incentives

Government green procurement is a market-oriented environmental and economic policy that plays an important role in promoting environmental innovation. Based on institutional theory, signal-transmission theory, and the resource-based view, this study examines the impact of government green procurement on the environmental innovation of semiconductor firms, as well as the mediating effect of technology mergers and acquisitions and the moderating effect of executive compensation incentives on that relationship. Selecting Chinese A-share listed semiconductor companies during the period from 2018 to 2022 as the research sample, the study uses multiple regression analysis to test the hypotheses. The results indicate that government green procurement and technology mergers and acquisitions positively impact the environmental innovation of semiconductor firms, while government green procurement negatively impacts the technology mergers and acquisitions of semiconductor firms. Technology mergers and acquisitions do not play a mediating role between government green procurement and semiconductor firms' environmental innovation. Executive compensation incentives weaken the positive impact of government green procurement on semiconductor firms' environmental innovation. This study analyzes the inherent mechanism of government green procurement affecting environmental innovation, and provides a theoretical basis for optimizing the government green-procurement system and improving semiconductor firms' environmental-innovation level.