Can the construction of intellectual property court promote corporate green innovation? Evidence from Chinese listed firms

Corporate green innovation is a crucial driver of sustainable economic development and environmental protection. This study examines the role of intellectual property rights in promoting corporate green innovation through judicial protection. Using data from China's A-share listed companies from 2009 to 2021, the study employs a quasi-natural experiment based on the establishment of Intellectual Property Courts (IPC) in 2014. The difference-in-differences (DID) and synthetic difference-in-differences (SDID) analyses demonstrate that IPC construction significantly enhances corporate green innovation, with results remaining robust across various robustness checks. Notably, the positive impact of IPCs is more pronounced in regions with stronger administrative and IP protection standards, as well as among mature, capital-intensive, and technology-driven firms. The study identifies R&D investment and human capital as key judicial protection mechanisms through which IPCs influence corporate green innovation. Additionally, the development of IP courts contributes to long-term financial stability and enhances firms' environmental, social, and governance (ESG) performance in green innovation. These findings offer valuable policy insights for China and other developing countries in designing intellectual property strategies that support sustainable corporate innovation. Strengthening judicial protection through specialised IP courts can be an effective approach to fostering corporate green innovation and ensuring long-term economic and environmental sustainability.