Managing CEO duality and economic uncertainty: strategies for aligning corporate sustainability and innovation in China’s energy market

Resource scarcity has prompted energy firms to adopt sustainable practices to enhance their innovation and competitiveness. This research examines the interaction between corporate sustainability and innovation in China’s energy sector. Using panel data from Chinese listed companies from 2011 to 2020, this study also explores how CEO duality and economic policy uncertainty affect China’s energy market. The results reveal a significant positive association between corporate sustainable development practices and innovation performance in China’s energy sector. The study also finds that the relationship between innovation performance and corporate sustainability is weakened by CEO dualism and economic uncertainty. The results are robust across alternative indicator of corporate sustainability practices. Furthermore, heterogeneity analysis based on ownership (SOE vs. non-SOE) and industry type (traditional energy industry vs new energy industry) confirms the main findings except by new energy industry. This study’s findings have implications for policymakers on how to effectively foster the growth of the Chinese energy sector and provide recommendations for industry boards of directors on how to organize their business.