Impact of firms' energy-saving effort and fixed asset characteristics on energy savings

We examine the role of some firm-level factors, such as energy-saving effort (ESE) and fixed asset characteristics (FACs, including fixed asset scale (FAS) and fixed asset efficiency (FAE)), in promoting energy saving (EnSv) for Chinese large firms that subject to a goal-setting regulation. We argue that the achievement of energy-saving goals is positively associated with ESE and FAS, and is the strongest when FAE is controlled at a moderate level. We also claim that whether firms comprehensively adopt the two major behaviors is related to their resource stocks. Basically, higher level of resource stocks corresponds to better energy saving performance. In terms of behavioral adoption, firms with lower resource stocks are more likely to make a full effort to achieve energy-saving goals, while firms with higher resource stocks may underestimate the status quo and reduce the adjustment of asset allocation, and even ignore the creation of energy-saving capabilities. We show empirical supports for our arguments using detailed data from Chinese government websites and the Chinese Industrial Enterprises Database for 510 firms in 2009. Our study highlights the micro-level contributors to energy saving and unveils unsustainability problems behind the success reflected in the data. Finally, we suggest that decision-makers should stress firm resource endowments when making policies and encourage firms to build comprehensive competence in pursuit of environmental performance. (c) 2020 Elsevier Ltd. All rights reserved.