The literature shows that a firm’s environmental information disclosure is affected by internal and external factors. However, it is unclear whether internal control positively impacts a firm’s green information disclosure. We collected data from the period 2010–2016 from either environmental reports or the environmental section of social responsibility reports of A-share listed companies in the heaviest polluting industries of the Chinese capital market, 1603 companies in total, and established an evaluation index for measuring firm greenness. Our research indicates that the level of internal control was positively correlated to the firm’s greenness level, and deficiencies in internal control were negatively correlated to the firm’s greenness level, indicating that high-quality internal control improves company green information disclosure. Pertaining to property rights, the internal control of state-owned enterprises had a significant effect on improving the level of environmental information disclosure. Among five elements of internal control, the internal environment, information and communication elements had a significant positive impact on firm greenness. Compared with samples with uncorrected major deficiencies in internal control, rectified companies’ environmental information disclosure was greener. These findings provide empirical evidence for a comprehensive understanding of the non-financial reporting goals of firm internal control, and will become a useful reference for firm green governance decision-making.

Auditing the natural-resource asset accountability of local officials is an institutional innovation that China used to transform its mode of economic development from that of an ‘industrial civilization’ to an ‘ecological civilization’. This study investigated the effect of changes in the assessment of local officials for promotion (i.e. including environmental protection in the assessment, along with economic performance) on the green response of enterprises. To this end, a nationwide pilot project (2015–2017) involving the auditing of natural-resource assets for local officials was used as a quasi-experiment. The results indicated that the green response level of the treatment (audit pilot) group was significantly higher than that of the control group. This indicated that the system for auditing the natural-resource assets for local officials had environmental governance effects. According to a mediation analysis, both governmental subsidies and bank credit mediated the effect of auditing on green response of enterprises. This indicates that during the pilot audits of natural-resource assets, high-polluting enterprises mainly met the requirements of the government and banks for a green response to obtain economic support. This study provides empirical evidence for evaluating policy effects and strengthening the audits of local officials’ environmental accountability.

Accountability audits of natural resources, which aim to support green development, constitute a Chinese institutional innovation. In this study, we employed a multiperiod difference-in-differences model to investigate the influence of accountability audits of natural resources on the industrial green total factor productivity by matching 2012 to 2019 province‒industry annual data. We demonstrated that accountability audits of natural resources considerably increase the green total factor productivity among heavily polluting industries and the overall industry greening level. These findings continued to hold after expansion tests, and a series of robustness tests were performed. Further analysis revealed that via resource allocation optimization and driven by technological innovation, audit supervision supports increased green total factor productivity levels among heavy polluters. Moreover, regional, industrial, and individual characteristics exerted heterogeneous impacts on industrial green transformation. Thus, this study yields a novel contribution, as it is the first in which industry-level data are used to clarify the controversy observed in previous studies and the first to provide incremental empirical evidence to support the reliability and sustainability of the policy effects of accountability audits of natural resources.