Can CEO's professional connections drive green innovation of SMEs?

Abstract Drawing on social capital theory, we analysis the influence of CEO's professional connections on the green innovation of SMEs. Using data from Chinese manufacturing SMEs, we find that CEO's professional connections can promote green innovation in SMEs. This finding still holds through several endogeneity and robustness tests. We find that this positive relationship is strengthened when the firm faces a more intense industry environment and when the CEO is chairman of the board. By testing the mechanism, we further find that alleviating financing constraints, improving information transparency, and promoting long‐term orientation play a key role in this positive relationship. These findings advance the research process on social capital theory and corporate green innovation and provide important insights into the green innovation practices in SMEs.