Abstract
The paper takes listed companies in the heavily polluting industry from 2009–2017 as a research sample to explore whether heavy pollution enterprises’ environmental protection investment helps their debt financing under the institutional background of China’s continuous implementation of green credit policy. It is found that, in general, the environmental protection investment of heavy pollution enterprises helps them to obtain more and relatively long-term new loans; in terms of time, this effect is more evident after the release of China’s Green Credit Guidelines in 2012; in addition, the level of regional environmental pollution, the level of financial development and the green fiscal policy also have a moderating effect on this. This paper enriches the study of the economic consequences of corporate environmental protection investment from the perspective of debt financing. It examines the effects of the implementation of China’s green credit policy and other institutional factors to provide a reference for the heavy pollution enterprises’ environmental protection investment and the implementation of green credit policy by local governments in China.
Highlights
China’s economy has experienced nearly four decades of rapid growth
This paper mainly studies that environmental protection investment of heavily polluting enterprises will promote their debt financing, but enterprises may have more funds to invest in environmental protection activities after obtaining more debt financing
This paper investigates whether environmental investments by heavy pollution enterprises help their debt financing in the institutional background of China’s continued implementation of green credit policies
Summary
China’s economy has experienced nearly four decades of rapid growth. during the process, problems such as tightened resource constraints, severe environmental pollution, and degraded ecosystems have appeared, driving the capacity of both resources and the ecological environment to the limit. To address the above questions, this paper selects A-share listed companies in heavy pollution industries in China’s Shanghai and Shenzhen markets from 2009–2017 as a sample to clarify the relationship between firms’ environmental investment and debt financing It explores whether it can provide financing convenience for heavy polluting enterprises in the institutional context of China’s continuous implementation of green credit policy. The innovation of this study is that: In terms of literature, this paper enriches the research on the economic consequences of enterprises’ environmental protection investment from the perspective of debt financing It examines the effects of green credit policies on firms in China and other institutional environmental factors and expands the research on green credit related to micro firms. The rest of this paper is organized as follows: the second part presents the research hypothesis of this paper based on the institutional background and theoretical analysis of green credit in China; the third part is the research design; the fourth part is the empirical results and analysis; the fifth part is the further analysis of the mechanism of action; and the research conclusion and indications
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