Although green growth has become the economic development strategy of many countries in the world, and studies have analyzed the influencing factors of green growth from multiple angles, there are few literatures devoted to the impact of fintech and green finance on green growth. From the perspective of fintech development, this paper tries to construct a comprehensive index to evaluate the green growth of regional economy based on the in-depth analysis of the influence mechanism of green finance on green growth. At the same time, China's provincial panel data from 2011 to 2018 are selected to test the impact of fintech innovation and green finance on green growth, and its mechanism. It turns out that fintech and green finance significantly promotes green economic growth. At the same time, the impact of fintech and green finance on green growth has obvious regional heterogeneity, that is, the impact in eastern China is significantly stronger than that in central and western China. Further research shows that fintech innovation mainly promotes green economic growth through green credit and green investment. Therefore, fintech innovation can promote green economic growth by improving the development level of green finance, which has great reference significance for most countries. 

The impact of fintech innovation on green growth in China: Mediating effect of green finance

‘Sustainable investment’—includes a variety of asset classes selected while caring for the causes of environmental, social, and governance (ESG). It is an investment strategy that seeks to combine social and/ or environmental benefits with financial returns, thus linking investor’s social, ethical, ecological and economic concerns Under certain conditions, these indices also help to attract foreign capital, seeking international participation in the local capital markets. The purpose of this paper is to study whether the sustainable investment alternatives offer better financial returns than the conventional indices from both developed and emerging markets. With an intent to maintain consistency, this paper comparatively analyzes the financial returns of the Thomson Reuters/S-Network global indices, namely the developed markets (excluding US) ESG index—TRESGDX, emerging markets ESG index—TRESGEX, US large-cap ESG index—TRESGUS, Europe ESG index—TRESGEU, and those of the usual markets, namely MSCI world index (MSCI W), MSCI All Country World Equity index (MSCI ACWI), MSCI USA index (MSCI USA), and MSCI Europe Australasia Far East index (MSCI EAFE), MSCI Emerging Markets index (MSCI EM) and MSCI Europe index (MSCI EU). The study also focusses on the inter-linkages between these indices. Daily closing prices of all the benchmark indices are taken for the five-year period of January 2013–December 2017. Line charts and unit-root tests are applied to check the stationary nature of the series; Granger’s causality model, auto-regressive conditional heteroskedasticity (ARCH)-GARCH type modelling is performed to find out the linkages between the markets under study followed by the Johansen’s cointegration test and the Vector Error Correction Model to test the volatility spillover between the sustainable indices and the conventional indices. The study finds that the sustainable indices and the conventional indices are integrated and there is a flow of information between the two investment avenues. The results indicate that there is no significant difference in the performance between sustainable indices and the traditional conventional indices, being a good substitute to the latter. Hence, the financial/investment managers can obtain more insights regarding investment decisions, and the study further suggests that their portfolios should consider both the indices with the perspective of diversifying the risk and hedging, and reap benefits of the same. Additionally, corporate executives shall use it to benchmark their own performance against peers and track news as well.

Can Sustainable Investment Yield Better Financial Returns: A Comparative Study of ESG Indices and MSCI Indices

China's green growth has shown a trend of fluctuation year by year. Simultaneously, Chinese local governments have pursued simple economic growth driven by the interests of "political competition" for a long time, while the supervision of the ecological environment has been loosened and tightened. In this environment, financial development and technological innovation may easily become the accelerator of this phenomenon, thus exacerbating the fluctuation of green growth. To deeply excavate the key factors to achieve stable and sustained growth of green economy, based on the annual panel data of 30 provinces in China from 2011 to 2018, this paper studies the impact of financial development and technological innovation on the volatility of green growth using dynamic system GMM method. The findings of this paper are shown as follows: First, the expansion of financial institutions' scale will significantly enhance the volatility of green growth. Second, the increase in the scale of the stock market will also significantly cause green growth fluctuations. Third, the interaction between financial development and technological innovation can significantly weaken the volatility of green growth. Fourth, financial development measured by stock market indicators is more efficient than financial development measured by financial institutions indicators to curb the volatility of green growth. Fifth, the fluctuation of green growth in the previous period will reduce the volatility of green growth in the current period. This study provides new evidence for exploring the power source to promote the stability and sustainable growth of the green economy in the special stage of financial and technological integration. Controlling the development scale of financial institutions and removing their state preferences, expanding the development of capital markets, and deepening the integration of financial development and technological innovation are conducive to achieve stable green growth.

Impact of financial development and technological innovation on the volatility of green growth—evidence from China

To contribute to overcoming global sustainability challenges, investors have been increasingly interested in making sustainable investments and incorporating environmental, social and governance (ESG) criteria into their portfolio selection decisions and managerial activities. However, these investors and other agents interested in sustainable investment need updated and robust information to support their decision making. We analyzed the performance of several Dow Jones Sustainability Indices (DJSIs) and compared them with their respective market benchmarks from 2013 to 2018. The indices comprise the following regions and countries: the world, the Asia‐Pacific, Europe, emerging markets and the US. The analysis was conducted based on both classic and modern portfolio metrics. The results suggest that sustainable investment performance is still heterogeneous worldwide, but there is a promising opportunity for investors to obtain superior risk‐adjusted returns in certain regions while incorporating sustainable investment practices. The findings are of utmost importance to financial market practitioners, business managers, academics and other stakeholders interested in promoting investments, corporate practices and scientific knowledge to achieve the Sustainable Development Goals (SDGs).

Rui Huo

Papers

Volatility transmissions across international oil market, commodity futures and stock markets: Empirical evidence from China

Return and volatility spillovers effects: Evaluating the impact of Shanghai-Hong Kong Stock Connect

Impacts of China's crash on Asia-Pacific financial integration: Volatility interdependence, information transmission and market co-movement

China–Africa financial markets linkages: Volatility and interdependence

Relationships between Chinese stock market and its index futures market: Evaluating the impact of QFII scheme