How Companies Learn from Each Other to Go Green

In the world of business, companies are increasingly focusing on being environmentally friendly, socially responsible, and well-governed. But how do these ideas spread from one company to another? It turns out that who a company knows and works with plays a big role. Researchers looked at over 4, 500 Chinese companies from 2015 to 2023. They found that companies in the same area or industry often influence each other's efforts to be more sustainable. This isn't just about copying each other. It's about sharing information, resources, and even reputation. The study showed that being connected to other companies can lead to big improvements. On average, companies saw a boost of about 32% in their sustainability efforts. But not all connections are equal. Being part of a group of companies from different industries seems to help more than just being in the same industry. One key finding was that having people on the board who know about sustainability makes a big difference. These companies saw even bigger benefits, earning an extra 28. 58 million RMB. This shows that having the right knowledge and connections can really pay off. The research also confirmed that these effects are real and not just coincidences. The study used advanced methods to make sure the results were solid. This is important because it helps companies and policymakers understand how to encourage more sustainable practices. However, it's not all good news. The study also found that being too focused on what other companies in the same industry are doing can actually hold a company back. This is because it might limit new ideas and innovation. In the end, this research gives us a better understanding of how companies learn from each other. It shows that the right connections and knowledge can make a big difference in how companies approach sustainability.