Is Promoting Green Finance in Line with the Long-Term Market Mechanism? The Perspective of Chinese Commercial Banks

Zhang, Kai; Zhou, Xinmiao

doi:10.3390/math10091374

Cited by 9 publications

(4 citation statements)

References 23 publications

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“…Therefore, banks apply credit rationing to heavily polluting enterprises to mitigate credit and environmental risks and safeguard their own credit quality. The introduction of a green credit policy means that heavily polluting enterprises face a stricter financing environment and that the available credit for heavily polluting enterprises is significantly reduced; this, in turn, reduces available cash flow (Liu & He, 2021;Tan et al, 2022b;Zhang & Zhou, 2022). A green credit policy can reduce the credit resources available to firms and decrease their disposable cash flow.…”

Section: Theoretical Analysis and Hypothesis Formulationmentioning

confidence: 99%

Can green credit policy under the concept of green economy curb corporate financialization to promote sustainable development?

Strielkowski²,

Li³

et al. 2023

Front. Environ. Sci.

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Under the concept of green economy, discovering how to utilize the Green Credit Guidelines in a way that guides enterprises to focus on their industries and to promote sustainable development has become an important and urgent objective. It is also conducive to the successful implementation of the “double-carbon target”. This paper uses Chinese A-share listed enterprises from 2007–2018 as its research object to explore whether green credit policy is conducive to reducing the financialization behavior of heavily polluting enterprises to curb their transformation from real to virtual. It is found that the financialization of heavily polluting enterprises has significantly decreased since the implementation of the Green Credit Guidelines in 2012, and these results remain unchanged after a series of robustness tests. A heterogeneity analysis shows that state-owned enterprises are subject to stronger policy effects than non-state-owned enterprises; furthermore, the studied policy effects are stronger in the eastern regions of China than in its central and western regions, and these effects are stronger in green provinces than in polluting provinces. A mechanism study finds that credit constraints and corporate innovation play a partially mediating role in the effect of green credit policy on corporate financialization. Further studies find that both the level of internal corporate governance and external monitoring contribute to the disincentivizing effect of green credit policy on financialization. Moreover, through an exploration of the possible economic consequences of the examined policy, it is found that the green credit policy reduces corporate financialization in favor of reducing inefficient corporate investment and major shareholders’ tunneling so that the level of corporate investor protection is improved. The findings validate the effectiveness of the Green Credit Guidelines and provide empirical evidence and empirical support for reducing corporate financialization to curb enterprises’ transformation from real to virtual and thus promoting the development of sustainability.

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Section: Theoretical Analysis and Hypothesis Formulationmentioning

confidence: 99%

Can green credit policy under the concept of green economy curb corporate financialization to promote sustainable development?

Strielkowski²,

Li³

et al. 2023

Front. Environ. Sci.

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show abstract

“…Green finance is mainly through the guidance of financial institutions to make them invest in green projects that can bring energy saving and environmental protection to improve

, as well as through social supervision to restrict the financial channels of high-polluting enterprises to either promote their transformation or green technology research and development, thus promoting

. On the one hand, as the original energy-intensive production method is transformed into a green and environment-friendly production method, which has a very high cost, this requires green finance to provide financial support for green industries to optimize capital allocation [ 24 , 25 , 26 ]. In order to obtain more support from green loans, enterprises are more willing to take the initiative of carrying out the research and development of green technology and improve their own productivity.…”

Section: Literature Reviewmentioning

confidence: 99%

Exploring the Mechanism of the Impact of Green Finance and Digital Economy on China’s Green Total Factor Productivity

Guo

Zhang

Liu

2022

IJERPH

Self Cite

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In the context of the “double cycle,” promoting the development of a green economy is an important goal for China’s high-quality economic development in the digital age. This paper uses data from 30 provinces (municipalities and autonomous regions) in China during the 2006–2019 period using the Compiled Green Finance Index (GF) and Digital Economy Index (DE). The interrelationship between green finance, digital economy and green total factor productivity (GTFP) is empirically tested by conducting multiple regressions on panel data from 2006–2019 to perform an empirical analysis. Based on this, further analysis was performed with the threshold model. This study found that green finance and digital economy can contribute well to green total factor productivity, but the combination of the two does not have a good effect on green total factor productivity. Further study found that the green finance and digital economy’s contribution to green total factor productivity is mainly derived from technological progress. The regression results based on the panel threshold model show that the more underdeveloped the digital economy is in certain regions, the stronger the role of green finance in promoting efficiency improvement. Therefore, policymakers should formulate differentiated green financial policies according to the level of development of the digital economy and give play to the role of green finance and the digital economy in promoting green total factor productivity.

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“…GCP also has a positive impact on the sustainability performance of financial institutions. Zhang and Zhou [ 30 ] show that GCP makes a significant contribution to the high-quality sustainable development performance of banks. Xi et al [ 31 ] use the green credit ratio and green reputation as indicators to measure the quality of GCP implementation in listed banks and verify that the quality of GCP implementation is significantly and positively correlated with the financial performance of listed banks.…”

Section: Theoretical Analysis and Hypothesis Formulationmentioning

confidence: 99%

The Impact Mechanism of Green Credit Policy on the Sustainability Performance of Heavily Polluting Enterprises—Based on the Perspectives of Technological Innovation Level and Credit Resource Allocation

Ding¹,

Jing

et al. 2022

IJERPH

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Green credit policy (GCP), as one of the key financial instruments to achieve ’carbon peaking’ and ‘carbon neutrality’ targets, provides capital support for the green development of enterprises. This paper explores the impact mechanism of GCP on the sustainability performance of heavily polluting enterprises (HPEs) from the perspectives of technological innovation level (TIL) and credit resource allocation (CRA), using panel data for Chinese A-share listed manufacturing companies from 2010 to 2015 to construct a propensity score matching and differences-in-differences (PSM-DID) model. We find that GCP has a causal effect on corporate sustainability performance (CSP). Although GCP significantly improves CSP, there is no long-term effect. Heterogeneity analysis shows that the relationship between GCP and CSP is only significant in non-state-owned enterprises and in eastern and low-market-concentration enterprises. Mechanism tests indicate that GCP stimulates HPEs to invest more in technological innovation and thereby improves CSP through the innovation compensation effect; the credit constraint and information transfer effects caused by GCP reduce the credit resources available to HPEs but have a significant forced effect on CSP. This paper enriches the study of the economic consequences of GCP and provides implications for stakeholders to improve the green financial system and achieve green transformation of HPEs.

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Is Promoting Green Finance in Line with the Long-Term Market Mechanism? The Perspective of Chinese Commercial Banks

Cited by 9 publications

References 23 publications

Can green credit policy under the concept of green economy curb corporate financialization to promote sustainable development?

Can green credit policy under the concept of green economy curb corporate financialization to promote sustainable development?

Exploring the Mechanism of the Impact of Green Finance and Digital Economy on China’s Green Total Factor Productivity

The Impact Mechanism of Green Credit Policy on the Sustainability Performance of Heavily Polluting Enterprises—Based on the Perspectives of Technological Innovation Level and Credit Resource Allocation

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