Guidance certification effect and governance supervision effect of government investment funds

The establishment of government investment funds serves as a crucial measure for governments at all levels to leverage their certification role and financial resources in attracting social capital to support enterprise development. This paper empirically examines the guiding certification effect and governance supervision effect of government investment funds on enterprise value enhancement, utilising panel data from listed companies and government investment fund investment event data spanning the period from 2011 to 2021. The research findings reveal that government investment funds significantly enhance the value of recipient enterprises. By leveraging their guidance and certification effects and governance supervision effects, these funds alleviate financing constraints, actively participate in corporate governance, and ultimately enhance corporate value. The impact of government investment funds is negatively moderated by the age and size of the enterprise, indicating that the "invest in early-stage and small businesses" investment strategy yields better results in promoting value enhancement. Furthermore, heterogeneity analysis demonstrates that government investment funds have a more pronounced impact on the value of non-heavily polluting industries, enterprises located in the eastern and southern regions of China, and non-state-owned enterprises. This article expands the research scope of government investment funds at the micro level, providing empirical evidence and theoretical support for optimising government investment funding policies and fostering the development of a modern capital market with distinctive Chinese characteristics.