Free Trade Zones and Corporate ESG: Evidence From a Quasi‐Natural Experiment in China
研究中国自贸区对企业ESG表现的影响，发现自贸区显著提升企业ESG评分，且效果随时间增强，机制是制度开放和市场激励，而非外资注入，同时促进了绿色专利而非绿色洗白。
ABSTRACT This study examines how China's Pilot Free Trade Zones (FTZs) influence corporate ESG performance. Using a staggered difference‐in‐differences model on Chinese listed firms from 2009 to 2024, we combine coarsened exact matching (CEM) and geography‐based instrumental variables to ensure robust identification. We document three main findings. First, FTZ designation significantly enhances firms' composite ESG scores, with effects that intensify over time. Second, mechanism analysis clarifies that the ESG improvement is driven by institutional openness and market incentives, rather than a mechanical injection of foreign capital. Specifically, we find that the effect is contingent on firm‐level heterogeneity: ESG gains are most pronounced among firms with high global connectivity or high financing constraints. Third, addressing concerns regarding ESG authenticity, we distinguish substantive innovation from symbolic disclosure. We find that FTZs significantly increase green patent grants without raising greenwashing scores, indicating genuine sustainability upgrading. The findings highlight that institutional liberalization reshapes nonfinancial corporate behavior by transmitting global norms and alleviating resource bottlenecks. Crucially, these results offer actionable insights for policymakers designing future mandatory ESG disclosure frameworks, demonstrating that institutional empowerment fosters authentic green governance in emerging markets.