Substantive or symbolic ? The strategic choice of sustainable environmental strategy for enterprises induced by the new environmental protection law

The new "Environmental Protection Law" (abbreviated as NEPL) holds milestone significance for the construction of China's ecological legal system. However, evidence regarding the impact of NEPL on sustainable environmental strategy (abbreviated as SES) still lacks empirical analysis. This study aims to examine the mechanisms and boundary conditions through which the NEPL influences SES. Utilizing a difference-in-differences approach, an empirical analysis is conducted on the data of listed companies on the Shanghai and Shenzhen A-shares from 2008 to 2021. The findings are as follows: (1) NEPL has significantly promoted both the substantive environmental strategy (abbreviated as SUB) and symbolic environmental strategy (abbreviated as SYM) of heavily polluting enterprises. Compared with SYM, the impact of NEPL on SUB is more significant. (2) Analyst coverage plays a significantly positive moderating role in the relationship between NEPL and SUB, while managerial myopia plays a significantly positive moderating role in the relationship between NEPL and SYM. (3) Environmental legitimacy pressure exerts a mediating effect on the relationship between NEPL and SES. The research findings enrich existing theories related to strategic choice and environmental policy under government intervention and provide policy recommendations for enterprises to achieve sustainable development in the context of NEPL.