The Impact of Green Credit Guidelines on the Technological Innovation of Heavily Polluting Enterprises: A Quasi-Natural Experiment from China

Abstract

This study investigates the impact of China’s Green Credit Guidelines on the technological innovations of heavily polluting enterprises. This study uses data obtained from the CSMAR database (2007–2018) and China Marketization Index Report by Province 2018 and uses the Green Credit Guidelines as a quasi-natural experiment. The sample was divided into an experimental group and a control group; the experimental group disclosed environmental and sustainable development information, while the control group did not. This study’s primary finding is that the Green Credit Guidelines can improve the level of technological innovation of heavily polluting enterprises and have a greater impact in areas with high levels of marketization, indicating that the Green Credit Guidelines have a positive effect on the technological innovation of heavily polluting enterprises. This provides China with an experience constructing relevant policies and regulations and provides empirical evidence regarding the technological innovations of heavily polluting enterprises from the perspective of factor market distortions and the Porter hypothesis.

The Impact of the Green Finance Reform and Innovation Pilot Zone on the Green Innovation—Evidence from China

“…Considering that the establishment of the pilot green financial reform zone has a policy radiation effect on the provinces where it is located, listed companies in the five provinces of the pilot zone are used as the experimental group, and listed companies in other provinces are used as the control group. A benchmark regression model was constructed as follows [ 21 , 22 ]. where i , j and t denote firm, province and time, respectively.…”

Bank green lending and credit risk: an empirical analysis of China's Green Credit Policy

“…Overview of empirical research on the firm's environmental performance effect indicates a generally positive relationship between corporate environmental performance and corporate financial performance (Ambec & Lanoie, 2008; Dixon‐Fowler et al, 2013; Orlitzky & Benjamin, 2001), as surviving firms with better environmental performance tend to have higher innovation (Chen et al, 2019; D'Orazio & Valente, 2019; Hao et al, 2020; Huang et al, 2019; Lv et al, 2021) and operational efficiency (He et al, 2019; Liu et al, 2019; Qi, 2021) as well as strong risk management capabilities (Cullen, 2018; D'Orazio & Popoyan, 2019). Improved innovation, efficiency and organizational management may lead to competitive advantage and increase shareholder value.…”

The Impact of Green Credit on the Green Innovation Level of Heavy-Polluting Enterprises—Evidence from China

“…They believe that this policy reduces the scale of credit and increases the cost of credit for heavily polluting enterprises, leading to the intensification of credit constraints. However, the study of [ 38 ] noted that the green credit policy positively affects the technological innovation of high-polluting companies, and with increased commercialization, this promotional effect will be more meaningful. Hong et al [ 39 ] are also of the opinion that Green Credit can promote innovation in green technologies across businesses.…”