Enterprises' Environmental Credit Assessment — from the Perspective of Financial Institutions' Green Credit

Abstract

Green credit is not only a financial leverage which promotes environmental protection, it is also an inevitable choice for financial institutions to evade their environmental risks, and the environmental credit assessment is a critical link for implementation of green credit. Based on analysis of various factors affecting enterprises’environmental credit level, this paper designs the indicators of environmental credit assessment, and builds the model for enterprises' environmental credit assessment with AHP(analytic hierarchy process) in order to provide financial institutions with a technical method for environmental credit assessment so as to promote implementation of green credit smoothly and evade the environmental risks in the field of credit effectively.

Can Green Credit Policy Promote the High-Quality Development of China’s Heavily-Polluting Enterprises?

“…(2) Through panel quantile analysis, this paper finds that the green credit policy has a significant positive impact on enterprises with higher development quality, but has no significant impact on enterprises with lower development quality. (3) This paper finds that after the implementation of the green credit policy, state-owned enterprises, large-scale enterprises, and enterprises located in western regions have significantly improved their development quality, while others have not been significantly affected by the green credit policy. (4) This paper proves that the upgrading of human resources in enterprises has strengthened the positive impact of the green credit policy on the high-quality development of enterprises.…”

“…Green credit is the earliest form of green financial instrument and currently serves as a fundamental component of green finance [2]. The primary objective of green credit policy is to guide and allocate social capital by implementing differentiated loan policies, ultimately promoting the coordinated development of financial institutions, enterprises, and society [3,4]. In 2012, the China Banking Regulatory Commission (CBRC) officially issued the "Green Credit Guidelines" (Guidelines), which require financial institutions to strengthen credit incentives for green enterprises with environmental protection, social, and governance as evaluation indicators, according to relevant national economic and industrial policies.…”

“…This paper once again proves through empirical research and various robustness tests that the green credit policy can promote enterprise development and enhance the quality of enterprise development, providing a strong empirical basis for policymakers. (3) In the previous literature on the effects of green credit policies, the heterogeneity of enterprises in different quantiles is seldom considered, and the regression results are also vulnerable to extreme values, which lead to unstable results. To address these issues, this study employs an unconditional panel quantile regression model to analyze the impact of green credit policy on the quality of enterprise development at different quantiles.…”

The effect of environmental credit rating on audit fees: A quasi-natural experiment from China

“…Not much research on the ECR focus on bank credit and developed Western countries. Li (2011) found that more and more financial institutions had begun to use the ECR as an important reference for making credit decisions [ 32 ], which effectively reduced their environmental risk assessment costs [ 33 ]. Weber (2012) used Canada as an example to further explore how financial institutions integrated environmental credit risk into credit risk management [ 34 ].…”

A Hybrid Multi-Criteria Decision-Making Model for Evaluating Companies’ Green Credit Rating

“…Sun and Wu [17] found that the green credit policy was as likely to increase economic growth as it was to do harm to it. Li [18] designed indicators of environmental credit assessment and built an AHP model for the environmental credit assessment of companies. Xu [19] constructed a Mamlquist green credit growth index to assess the comprehensive productivity performance of the banking and financial industry in China.…”