Abstract: Since the 18th National Congress of the Communist Party of China, the development concept that “lucid waters and lush mountains are invaluable assets” has propelled both theoretical strides and practical advances in environmental governance. Academically, the “weak Porter hypothesis” suggests that well-designed environmental regulations can spur corporate innovation. The 2015 revision of Environmental Protection Law of the People's Republic of China—an important milestone in the country's ecological-civilization legislation—provides a compelling quasi-natural experiment to test this hypothesis. Using a propensity-score-matched difference-in-differences (PSM-DID) framework, this study evaluates whether the new law has triggered the weak Porter effect and examines how firms' executive background might moderate this impact. The research findings show that, to date, the anticipated innovation boost has not fully materialized. In the short term, many firms have slowed their R&D outlays, preferring instead to bolster cash reserves rather than expand productive investments—an adaptive, cautionary response to more stringent environmental rules and an early stage of transition toward high-quality green development. Furthermore, we observe that the law's impact on innovation investment does not vary with firms' executive background, suggesting that China's efforts to build a standardized and equitable business environment and environmental governance framework are yielding tangible results. By offering fresh empirical insights into the Porter's hypothesis, this study concludes with four targeted policy recommendations: optimize regulatory instruments, strengthen governance systems, guide corporate green transformation, and prioritize investment in green technologies.