Organizational stakeholders and environmental sustainability investment: does China’s regional heterogeneity matter?

Purpose Given the regional diversity in China, this study aims to provide an empirical evaluation of how organizational stakeholders (i.e. customers, employees, suppliers and shareholders) affect corporate environmental sustainability investment (ESI). Design/methodology/approach To empirically investigate the influence of organizational stakeholders on ESI, this study used regional-level data consists of Chinese A-share stocks for the years 2009–2019. Findings This study’s findings show that pressure from customers, employees and suppliers has a significant effect on corporate ESI, with customers being the most important stakeholder group. Shareholders, by contrast, have no significant influence on ESI. The influence of these pressures is more pronounced in developed regions (the east) than in less developed (the west) localities of China. Research limitations/implications This study complements the stakeholder–institutional perspective by implying to consider the differentiated logics of the contesting stakeholders in the nonmarket operations. Practical implications Practically, this study poses that managers must realize the heterogeneity of pressures from stakeholders and the differentiated impact of these pressures keeping in view the institutional differences in different regions. Originality/value Our study reports initial empirical evidence that shows how regional differences influence the role of stakeholders in determining corporate environmental strategy.