Do Banks Value Green Management in China? The Perspective of the Green Credit Policy

Xing, Chao; Zhang, Yuming; Yuan, Wang

doi:10.1016/j.frl.2020.101601

Cited by 82 publications

(51 citation statements)

References 19 publications

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“…For instance, in line with the view that banks will reduce financing support for highly polluting enterprises to avoid legitimate environmental risks [29], Liu et al (2019) show that the loan amount and maturity for China's highly polluting enterprises are lower after the implementation of the green credit policy [13]. Based on these results, Xing et al (2020) demonstrate that the financing constraints of enterprises with higher green performance are alleviated by the green credit policy [4]. Meanwhile, He et al (2019) suggest that regional industrial pollution decreased after the implementation of the policy, which promoted the development of a green economy [6].…”

Section: Ecological Modernization Theory and The Green Credit Policymentioning

confidence: 82%

“…Various factors can affect the efficiency of China's green credit policy. The key requirement for policy success is the distribution of loan resources [4]. However, in the stage of policy design, namely, from 2007 to 2011, authors discussed the potential disadvantages of the policy implementation.…”

Section: Ecological Modernization Theory and The Green Credit Policymentioning

confidence: 99%

“…In summary, according to the above discussion, China's green credit policy has a redistribution effect on environment-friendly manufacturing firms of various sizes, and SMEMEs can benefit more than LEMEs, namely, banks indeed value SMEMEs. As the policy focuses primarily on the loan amounts that are granted to the firms [4], we establish the first positive hypothesis: Hypothesis 1. (H1).…”

Section: Positive Perspectivementioning

confidence: 99%

“…China's green credit policy was launched by the China Banking Regulatory Commission and other central government departments in 2012. It requires commercial banks to increase loan support for the green economy, especially by investing more funds in eco-friendly enterprises and projects, and it prohibits these banks from extending loans to any polluting firm or product [3,4]. Due to the "carrots and sticks" nature of the green credit policy, China's environment-friendly manufacturing enterprises and the firms with superior environmental performance can obtain better loan contracts after its implementation, while loan finance for heavily polluting enterprises has become more difficult [5,6].…”

Section: Introductionmentioning

confidence: 99%

“…The theoretical and practical contributions of this study are threefold: first, considering the relationship between the green credit policy and the characteristics of environment-friendly manufacturing enterprises with various scale levels, we expand the research into China's green credit policy and the field of green finance, e.g., Xing et al (2020) and Xu and Li (2020) [4,5]. To the best of our knowledge, our study is the first to consider an additional influence (redistribution effect) in the green financial policy literature.…”

Section: Introductionmentioning

confidence: 99%

See 4 more Smart Citations

Redistribution of China’s Green Credit Policy among Environment-Friendly Manufacturing Firms of Various Sizes: Do Banks Value Small and Medium-Sized Enterprises?

Zhang

Xing

Tripe

2020

IJERPH

Self Cite

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According to previous studies, China’s green credit policy, which was launched in 2012, increases environment-friendly manufacturing enterprises’ loan amounts. In this paper, we focus on a redistribution mechanism among environment-friendly manufacturing firms, namely, we determine whether the effects of the green credit policy differ between small and medium-sized environment-friendly manufacturing enterprises (SMEMEs) and large environment-friendly manufacturing enterprises (LEMEs). Using a difference in difference model (DID) and a difference in difference in difference model (DDD), we find that SMEMEs obtain more loans than LEMEs due to the green credit policy. We further analyze three potential foundations of this redistribution mechanism: information asymmetry, financial development, and government environmental investment. The results demonstrate that the redistribution effect occurs in both low and high information asymmetry conditions but only in regions with satisfactory financial development and with lower government environmental investment. Our findings enrich the literature on green credit, sustainable finance, and small finance, and they provide references for enterprises, banks, and governments.

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Section: Ecological Modernization Theory and The Green Credit Policymentioning

confidence: 82%

Section: Ecological Modernization Theory and The Green Credit Policymentioning

confidence: 99%

Section: Positive Perspectivementioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

See 3 more Smart Citations

Redistribution of China’s Green Credit Policy among Environment-Friendly Manufacturing Firms of Various Sizes: Do Banks Value Small and Medium-Sized Enterprises?

Zhang

Xing

Tripe

2020

IJERPH

Self Cite

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The philanthropic response of substantive and symbolic corporate social responsibility strategies to COVID‐19 crisis: Evidence from China

Zhong

Zhao

Shahab

2021

Corp Soc Responsibility Env

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The COVID‐19 epidemic broke out in China in January 2020, which triggered the largest wave of corporate philanthropic donations since the 2008 Sichuan earthquake. Based on A‐share listed firms in the Shanghai and Shenzhen stock exchanges in 2020, we study whether substantive and symbolic corporate social responsibility (CSR) strategies affect corporate philanthropic responses during the COVID‐19 crisis. We use the lagged annual donation and technical dimension scores (T scores) of rankins ratings (RKS) as proxies of CSR performance and CSR disclosure and then define the CSR gap as the gap between the two. The results show that substantive and symbolic strategies cause firms to have material differential responses in the COVID‐19 crisis. Specifically, the CSR gap is negatively related to the possibility and the level of crisis donation. In addition, (1) this difference is more pronounced in the earlier period of the COVID‐19 crisis; (2) the negative correlation is more pronounced in private firms; and (3) the crisis donation of firms with either strategy obtains no different response from the capital market. Our evidence suggests that the established CSR strategy influences the substantive response of Chinese firms to public emergencies, but their substantive response does not result in different reactions in the capital market.

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How does green credit policy improve corporate social responsibility in China? An analysis based on carbon‐intensive listed firms

Chen

Wang

et al. 2022

Corp Soc Responsibility Env

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For China to become carbon neutral, green financing is seen as a crucial avenue, wherein the green credit policy, which was introduced in 2012, is a crucial tool. However, whether the policy would work and how to improve its effectiveness remain unknown. This study attempts to analyze the policy's effects on carbon performance, a crucial measure of Corporate Social Responsibilities (CSR), particularly in carbon‐intensive industries, using a sample of Chinese listed companies from 2009 to 2018. As a result, first, it's confirmed that the policy can boost carbon performance of carbon‐intensive firms. Additionally, this study has verified that firm's R&D investment intensity has no mediating role in the relationship between the policy and carbon performance, while debt financing cost partly mediating the relationship, implying the policy fails to stimulate technological innovation. Moreover, firms with stronger environmental regulation intensity, weaker financing constraints, poorer corporate governance and more analyst following have greater promotion in carbon performance after the policy execution. Finally, the policy significantly improves the quality of corporate environment information disclosure. Briefly, this study enriches theoretical grounding regarding strategies of green reform in carbon‐intensive industries and provides implications for emerging economies to improve green finance via enhancing CSR.

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Do Banks Value Green Management in China? The Perspective of the Green Credit Policy

Cited by 82 publications

References 19 publications

Redistribution of China’s Green Credit Policy among Environment-Friendly Manufacturing Firms of Various Sizes: Do Banks Value Small and Medium-Sized Enterprises?

Redistribution of China’s Green Credit Policy among Environment-Friendly Manufacturing Firms of Various Sizes: Do Banks Value Small and Medium-Sized Enterprises?

The philanthropic response of substantive and symbolic corporate social responsibility strategies to COVID‐19 crisis: Evidence from China

How does green credit policy improve corporate social responsibility in China? An analysis based on carbon‐intensive listed firms

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