The Stock Performance of Green Bond Issuers During COVID-19 Pandemic: The Case of China

Abstract

The green bond (GB) is a new financial product in the green finance field that has recently become a corporate social responsibility (CSR) tool for organizations. Previous studies show that high-CSR firms receive more trust from shareholders during a financial crisis. This paper aims to assess the stock performance of publicly listed Chinese companies that issued GBs during the COVID-19 pandemic. The bond sample covers 2016–2019 and consists of 67 listed issuers. The paper uses the event study method based on the market and Fama-French (1993) three-factor models. Our results show that GB issuers exhibited significantly positive cumulative abnormal stock returns on the official announcement dates of the COVID-19 outbreak. The positive cumulative abnormal returns are mainly driven by non-financial GB issuers rather than financial GB issuers. The results reflect the attitudes of investors toward GB-issuing companies primarily in the context of the crisis and contribute to the development of green finance policies.

Impact of COVID-19 Travel Subsidies on Stock Market Returns: Evidence from Japanese Tourism Companies

“…Third, the positive effect of the subsidies was significantly smaller in the transportation sector. Finally, we also confirmed that our results are same when we use the Fama and French (1993) three factor (FF3) model to apply for ESM as in previous studies (Jin and Zhang 2023;Sakawa and Watanabel 2023). Our results are robust when we apply the alternative FF3 model.…”

“…We introduced a typical firm from each sectors. Fourthly, we also used the FF3 model to confirm the robustness of our results, similar to previous studies (Jin and Zhang 2023;Sakawa and Watanabel 2023). To use the alternative methodology of the FF3 model, we investigated whether the conclusion of ESM based on two different models are robustly confirmed.…”