Assessing the moderating effect of environmental regulation on the process of media reports affecting enterprise investment inefficiency in China

To achieve the triple goals of digesting excess capacity, making effective investments, and accelerating green governance, it is important and necessary to comprehensively examine the intrinsic relationship between media reports, environmental regulation, and enterprise investment inefficiency. To this end, this study employs multiple econometric models to investigate the intrinsic relationship between them by using the data of listed companies in China's A-share heavy-polluting industries between 2010 and 2020. The results of the study are as follows. Firstly, media reports can encourage heavy-polluting enterprises to pay attention to stakeholder demands and significantly ameliorate the enterprise investment inefficiency. In addition, environmental regulation can ameliorate the enterprise investment inefficiency through the "push-back effect" and "compensation effect". Moreover, pollution fees can positively moderate the amelioration effect of media reports on the investment inefficiency of heavy-polluting enterprises, while it fails in terms of environmental protection subsidies. Finally, conclusions and policy implications are provided.