Does the GreenWatch program work? Evidence from a developed area in China

The GreenWatch program has been implemented nationally in China. However, whether the program and its process have been effective in improving firms' environmental performance remains unclear. Based on the stakeholder theory, this paper conducts a comparative analysis between firms participating in the program and those that do not, all of which are based in Changshu City in the developed part of Jiangsu Province, China. Data suggest that GreenWatch encourages firms to improve and disclose their environmental performance. Through pressures imposed by different stakeholders—from the government, investors, and consumers, to the public, such as the community and media—this program has become the main driving force for improving the firms' environmental performance. The current study also provides substantial evidence that public disclosure in China opens up channels for effective public participation. Therefore, the GreenWatch program deserves to be promoted in China.