This article uses the “Green Credit Guidelines” promulgated in 2012 as an example to construct a quasi-natural experiment and uses the double difference method to test the impact of the implementation of the “Green Credit Guidelines” on the green innovation activities of heavy-polluting enterprises. The study found that, in comparison to non-heavy polluting enterprises, the implementation of green credit policies inhibited the green innovation of all heavy-polluting enterprises. In the analysis of heterogeneity, this restraint effect did not differ significantly due to the nature of property rights and the company’s size. The mechanism test showed that green credit policy limits the efficiency of business investment and increases the cost of financing business debt. Eliminating corporate credit financing, particularly long-term borrowing, negatively impacts the green innovation behavior of listed companies.

/pdf/the-impact-of-green-credit-on-the-green-innovation-level-of-3n1exbp2.pdf

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

As financial institutions and policymakers worldwide are considering how to integrate sustainability considerations throughout financial systems, a critical question is whether banks can effectively assess and monitor borrowers’ environmental credit risk. China’s green credit reforms, part of sweeping “green finance” policies adopted by the Chinese government over the past decade, require banks to do exactly that. China’s green credit reforms offer an opportunity to test current theories of the role of creditors in corporate governance and the potential role of banks in driving sustainable finance across global capital markets. 

This study uses data from the 21 Chinese banks that are at the forefront of China’s green finance initiatives, as well as insights from fieldwork conducted in 2016 and 2017, to examine banks’ ability to monitor and price environmental credit risk. This investigation shows that leading Chinese banks are strengthening their ability to integrate environmental criteria into credit risk assessment but that key barriers to efficient pricing and monitoring of environmental credit risk remain. This article concludes with lessons from the Chinese context for sustainable finance reform elsewhere.

Sustainable Finance & China's Green Credit Reforms: A Test Case for Bank Monitoring of Environmental Risk

On 16 July 2021, the national carbon emissions trading market opened, and the national carbon market officially started online trading. However, it is still unclear whether the carbon emissions trading policy can effectively optimize the manufacturing structure. We studied the experiment of the carbon emissions trading policy that has been ongoing in Guangdong, China, since 2013 to assess the impact of this policy on the manufacturing structure in Guangdong Province compared to other provinces in mainland China that have not implemented a carbon trading pilot policy. The methodology uses a synthetic control method. Using this method, a “synthetic Guangdong” was constructed using data from 23 provinces (municipalities and autonomous regions) in mainland China that did not implement carbon trading policies from 2009 to 2019. The synthetic province had similar observed characteristics to Guangdong before the carbon emissions trading experiment in 2013. Therefore, manufacturing structure differences between Guangdong and the synthetic province after 2013 could be attributed only to the carbon emissions trading policy. The conclusion indicates that in the short term, the carbon emissions trading policy implemented in 2013 can significantly promote manufacturing upgrading and manufacturing greening in Guangdong Province. This policy can optimize the manufacturing structure of Guangdong Province through improving the technological innovation of enterprises and increasing foreign direct investment. Therefore, in regions whose manufacturing structure is similar to Guangdong Province, implementing a carbon emissions trading policy can promote manufacturing upgrading and manufacturing greening.

/pdf/can-chinas-policy-of-carbon-emissions-trading-optimize-2mhmf3hj.pdf

Can China’s Policy of Carbon Emissions Trading Optimize Manufacturing Structure? Evidence from Guangdong Based on a Synthetic Control Approach

Since China’s reform and opening up, the speed of economic development has increased significantly. However, at the same time, there are also serious environmental pollution problems. To resolve the deep-seated contradiction between economic growth and environmental protection, green finance has gradually gained attention in China’s development. Based on this, the paper explores the impact of green finance on the quality of the ecological environment in the Yangtze River Economic Belt. The main part of the paper is based on panel data of eleven provinces and cities in China’s 2011–2020 Yangtze River Economic Belt. Seven indicators, including chemical oxygen demand COD, harmless treatment rate of domestic waste, and green coverage rate of built-up, were used to construct an ecological and environmental quality evaluation index system. The entropy method is used to measure the ecological environment quality level and green finance development level of various provinces and cities in the Yangtze River Economic Belt. The impact of green finance development on ecological environment quality is analyzed using a panel data model. The research results show that: (1) The development level of green finance and the quality of the ecological environment in the Yangtze River Economic Belt have improved between 2011 and 2020. (2) The development of green finance has a significant positive impact on the quality of the ecological environment in the Yangtze River Economic Belt. In addition, related research has focused on the impact of green finance on a certain branch of ecological and environmental quality and lacks an analysis of the overall impact. Therefore, this paper constructs a comprehensive evaluation system for ecological environment quality and analyzes the overall impact of green finance on ecological environment quality in the region.

/pdf/the-effect-of-green-finance-on-the-ecological-and-1yxbh216.pdf

The Effect of Green Finance on the Ecological and Environmental Quality of the Yangtze River Economic Belt

In the context of today’s sustainable development, green finance and industrial structure optimization and upgrading are important components of sustainable development and are new trends in today’s society. Based on the relevant data from 31 provinces in China from 2011 to 2020, this study considers the role of green finance in optimizing and upgrading industrial structure from the technological progress perspective. The entropy weight method and the principal component downscaling method are used to measure the level of green finance development and industrial structure optimization and upgrading indexes of each province; the existence of the intermediary effect is verified using stepwise regression and the Sobel test. Through model construction comparison, the two-step system GMM is optimal, and the corresponding final two-step system GMM model is constructed to verify the promotion effect of green finance on the optimization and upgrading of industrial structure. The model introduces the control variables of openness to the outside world, government support, human resources, environmental regulation, and urbanization rate. Except for the insignificant effect of the urbanization rate control variable, the rest of the control variables have a significant promotion effect on the optimization of industrial structure because the corresponding urbanization rate in China at this stage does not bring about the optimization and upgrading of industrial structure. After the robustness test of the model, a sub-regional regression using the constructed model reveals that the effect of green finance on the optimization and upgrading of industrial structure is most significant in the central region, whereas the central and western regions are weaker compared to the east.

https://www.frontiersin.org/articles/10.3389/fenvs.2022.919950/pdf

Can Green Finance Promote the Optimization and Upgrading of Industrial Structures?—Based on the Intermediary Perspective of Technological Progress

In order to explore the influence of green credit on the optimization and rationalization of the industrial structure in China, based on the relevant data of the green credit balance, interest expenditure in six high-energy-consuming industries, and industrial structure in China from 2007–2019, the paper first measured the green credit index and the index of industrial structure optimization and rationalization by the methods of entropy weight and Theil index. Then, the coupling model was adopted to study the coupling degree and the coupling coordination degree between them, and the regression model was employed to further study the influence coefficient of green credit on the optimization and rationalization of industrial structure. Research showed that the degree of coupling between green credit and industrial structure rationalization presents three stages—extremely low coupling, low coupling, and moderate coupling—and the degree of coupling coordination presents two stages—extremely low coordination and low coordination. Similarly, the degree of coupling between them presents two stages—extremely low coupling and low coupling—and the degree of coupling coordination presents two stages—extremely low coordination and low coordination. Regression analysis showed that the influence coefficients of the green credit index on rationalization and optimization of industrial structure were 0.56 and 0.03, respectively, which supported the conclusion that the coupling degree between the former two is higher than that between the latter two on the one hand, and made it clear that green credit positively and effectively guides the rational allocation of resources and promotes secondary and tertiary industries on the other hand.

https://www.mdpi.com/2071-1050/13/11/5997/pdf

Chuanzhe Liu

Papers

Empirical Analysis of the Influence of Green Credit on the Industrial Structure: A Case Study of China