Environmental Auditing Shapes Industrial Green Transformation

Yi Yao

doi:10.62177/apemr.v3i5.1644

Authors

Yi Yao Chongqing Polytechnic University of Electronic Technology

DOI:

https://doi.org/10.62177/apemr.v3i5.1644

Keywords:

Environmental Auditing, Natural-Resource Accountability, Industrial Green Transformation, Green Innovation, Green Total Factor Productivity, Multilevel Governance

Abstract

Environmental auditing has become an important instrument for aligning industrial development with ecological accountability. Existing studies link natural-resource accountability audits to corporate green innovation, environmental investment, pollution control, carbon efficiency and green productivity. Yet these outcomes are usually examined in isolation. The chain connecting public accountability to firm behaviour and industrial transformation therefore remains fragmented. Here, we develop a multilevel mechanism framework through a structured integrative review of research on environmental auditing, regulation, corporate environmental strategy and green total factor productivity. The framework distinguishes three audit functions: detection, deterrence and prevention. These functions alter local government incentives, environmental information, corporate governance and stakeholder monitoring. Their interaction determines whether firms pursue symbolic compliance, incremental adjustment or substantive transformation. Firm responses then aggregate through technological progress, efficiency improvement and resource reallocation. Fiscal pressure, enforcement capacity, market development, ownership, pollution intensity and public participation condition each transition. The framework explains why similar audit arrangements can produce contrasting effects across firms, industries and regions. It also identifies feedback from industrial outcomes to later audit priorities and standards. Environmental auditing is therefore most likely to support durable green transformation when credible findings lead to corrective responsibility, organisational learning and future decision constraints. This framework offers testable propositions and a bounded basis for audit design.

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