Green financial policy and investment-financing maturity mismatch of enterprises
Abstract
Green financial policies play an important role in acceleration of China’s green transformation. Existing associated studies mainly focus on the qualitative analysis and descriptive analysis. However, it still lacks empirical studies. To explore the relationship between green finance policies and the investment and financing terms of enterprises, the effects of green financial policies on investment-financing maturity mismatch of A-share companies on Shanghai Stock Exchange and Shenzhen Stock Exchange from 2009 to 2020 were investigated in this study by a difference-in-difference (DID) model. Results demonstrate that green financial policies significantly alleviate short-term loans used as long-term investment in enterprises. Green financial policies inhibit investment-financing maturity mismatch of enterprises by increasing loan availability, lowering financing cost and increasing proportion of long-term loans of enterprises. Such effect is more obvious in enterprises with higher internal control quality and enterprises with more transparent information. Green financial policies can alleviate short-term loans used as long-term investment in non-state-owned enterprises more obviously than state-owned enterprises. Research results provide some references to alleviate debt risks of enterprises. Enterprises are recommended to seek steady development, fulfil social responsibilities and take green low-carbon social actions extensively.
Keyword : investment-financing term, maturity mismatch, green finance policy, debt maturity structure, financing cost, short-term loans
How to Cite
Zhang, L., Zhang, K., & Bilan, Y. (2024). Green financial policy and investment-financing maturity mismatch of enterprises. Journal of Business Economics and Management, 25(3), 590–611. https://doi.org/10.3846/jbem.2024.21609
This work is licensed under a Creative Commons Attribution 4.0 International License.
References
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Liu, X., Wang, E., & Cai, D. (2019). Green credit policy, property rights and debt financing: Quasi-natural experimental evidence from China. Finance Research Letters, 29, 129–135. https://doi.org/10.1016/j.frl.2019.03.014
Liu, Y., & Bai, X. Y. (2020). Does Chinese stock market reward for going green? Based on enterprise sustainable development. Business and Management Journal, 42(01), 155–173.
Lu, J., Ren, L., Zhang, C., Rong, D., Ahmed, R. R., & Streimikis, J. (2020). Modified Carroll’s pyramid of corporate social responsibility to enhance organizational performance of SMEs industry. Journal of Cleaner Production, 271, Article 122456. https://doi.org/10.1016/j.jclepro.2020.122456
Luo, H., Jia, X. Y., & Wu, J. F. (2021). Internal control quality and maturity mismatch of enterprises’ investment and financing. International Financial Studies, (9), 76–85. https://doi.org/10.16475/j.cnki.1006-1029.2021.09.008
Lv, C., Shao, C., & Lee, C. C. (2021). Green technology innovation and financial development: Do environmental regulation and innovation output matter? Energy Economics, 98, Aricle 105237. https://doi.org/10.1016/j.eneco.2021.105237
Ma, Y. M., Hu, C. Y., & Liu, X. (2020). Issuing green bonds and enhancing corporate value: A mediation effect test based on the did model. Financial Forum, 25(09), 29–39. https://doi.org/10.16529/j.cnki.11-4613/f.2020.09.005
Mamun, M. A., Boubaker, S., & Nguyen, D. K. (2022). Green finance and decarbonization: Evidence from around the world. Finance Research Letters, 46(5), Article 102807. https://doi.org/10.1016/j.frl.2022.102807
Mishchuk, H., Czarkowski, J. J., Neverkovets, A., & Lukács, E. (2023). Ensuring sustainable development in light of pandemic “New Normal” Influence. Sustainability, 15(18), Article 13979. https://doi.org/10.3390/su151813979
Musova, Z., Musa, H., & Matiova, V. (2021). Environmentally responsible behaviour of consumers: Evidence from Slovakia. Economics and Sociology, 14(1), 178–198. https://doi.org/10.14254/2071-789X.2021/14-1/12
Ning, J. H., & Wang, M. (2021). Can green bonds alleviate “short-term financing and long-term investment” of enterprises? Empirical evidence from the bond market. Securities Market Herald, (09), 48–59.
Niu, H. P., Zhang X. Y., & Zhang P. D. (2020). Institutional change and effect evaluation of green finance policy in China: Evidence from green credit policy. Management Review, 8, 3–12. https://doi.org/10.14120/j.cnki.cn11-5057/f.2020.08.001
Olzhebayeva, G., Buldybayev T., Pavalkis D., Kireyeva, A., & Micekiene, A. (2023). Is there interest in green deal research in Central Asia? Economics and Sociology, 16(3), 302–322. https://doi.org/10.14254/2071-789X.2023/16-3/16
Omran, M. S., & Yaaqbeh, M. N. (2023). Climate change and business accountability, empirical evidence on the roles of environmental strategy and environmental accounting. Business Ethics, the Environment & Responsibility, 32(4), 1592–1608. https://doi.org/10.1111/beer.12591
Shi, B., & Wang, H. (2023). Green finance and improving habitat: Corporate financial strategic planning and risk regulation under the influence of green consumption behavior. Transformations in Business and Economics, 22(3a), 576–591.
Štreimikienė, D., Mikalauskienė, A., & Macijauskaitė-Daunaravičienė, U. (2022). Role of information management in implementing the Green Deal in the EU and the US. Journal of International Studies, 15(4), 9–27. https://doi.org/10.14254/2071-8330.2022/15-4/1
Volz, U. (2018). Fostering green finance for sustainable development in Asia (ADBI Working Paper, 814). SSRN. https://doi.org/10.2139/ssrn.3198680
Wang, C. W., Chiu, W. C., & King T. H. D. (2020). Debt maturity and the cost of bank loans. Journal of Banking & Finance, 112, Article 105235. https://doi.org/10.1016/j.jbankfin.2017.10.008
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Wang, Y. L., Lei, X. D., & Long, R. Y. (2021). Can green credit policy promote the corporate investment efficiency. China Population, Resources and Environment, 31(1), 123–133.
Wu, H. Y., & Yin, D. S. (2021). The reward and penalty effects of the green credit policy on corporate debt financing: An effect evaluation based on a quasi-natural experiment. Contemporary Finance & Economics, 02, 49–62. https://doi.org/10.13676/j.cnki.cn36-1030/f.2021.02.006
Zhang, R., Li, Y., & Liu, Y. (2021a). Green bond issuance and corporate cost of capital. Pacific-Basin Finance Journal, 69(10), Article 101626. https://doi.org/10.1016/j.pacfin.2021.101626
Zhang, X. M., & Ye, Z. W. (2021). Obtaining trust helps? Does social trust mitigate investment with short-term financing? Foreign Economics & Management, 43(1), 44–57. https://doi.org/10.16538/j.cnki.fem.20200816.201
Zhong, K., Cheng, X. K., & Zhang, W. H. (2016). The moderating level of monetary policy and the mystery of short loans used as long investments by enterprises. Journal of Management World, (03), 87–98. https://doi.org/10.19744/j.cnki.11-1235/f.2016.03.008
Zhou, X. X., Jia, M. Y., & Zhao, X. (2023). An Empirical study and evolutionary game analysis of green finance promoting enterprise green technology innovation. China Industrial Economics, (06), 43–61. https://doi.org/10.19581/j.cnki.ciejournal.2023.06.002
Zhu, J. M., Wang, J. L., Yu, Z. Q., Yang, S. Y., & Wen, Q. X. (2020). Policy effectiveness of green finance: market reaction to the issuance of green bonds in China. China Public Administration Review, 2(2), 21–43.
Zou, J. J. (2017). Green finance policy, policy synergy and industrial pollution intensity: A perspective of policy text analysis. Financial Theory & Practice, (12), 71–74.
Aguilar, P., González, B., & Hurtado, S. (2023). Green policies and transition risk propagation in production networks. Economic Modelling, 126(9), Article 106412. https://doi.org/10.1016/j.econmod.2023.106412
Ahmad, M., Ahmed, Z., Yang, X., & Can, M. (2023). Natural resources depletion, financial risk, and human well-being: What is the role of green innovation and economic globalization? Social Indicators Research, 167(1), 269–288. https://doi.org/10.1007/s11205-023-03106-9
Baker, M., Bergstresser, D., Serafeim, G., & Wurgler, J. (2018). Financing the response to climate change: The pricing and ownership of US green bonds (Working paper No. w25194). National Bureau of Economic Research. https://doi.org/10.3386/w25194
Bhattarai, U., Lopatka, A., Devkota, N., Paudel, U. R., & Németh, P. (2023). Influence of green human resource management on employees’ behavior through mediation of environmental knowledge of managers. Journal of International Studies, 16(3), 56–77. https://doi.org/10.14254/2071-8330.2023/16-3/3
Bilan, Y., Mishchuk, H., & Pylypchuk, R. (2017). Towards sustainable economic development via social entrepreneurship. Journal of Security & Sustainability Issues, 6(4), 691–702. http://doi.org/10.9770/jssi.2017.6.4(13)
Billah, M., Amar, A. B., & Balli, F. (2023). The extreme return connectedness between Sukuk and green bonds and their determinants and consequences for investors. Pacific-Basin Finance Journal, 77(2), Article 101936. https://doi.org/10.1016/j.pacfin.2023.101936
Bonfim, D., Dai, Q., & Franco, F. (2018). The number of bank relationships and borrowing costs: The role of information asymmetries. Journal of Empirical Finance, (46), 191–209. https://doi.org/10.1016/j.jempfin.2017.12.005
Diamond, D. W. (1991). Debt maturity structure and liquidity risk. The Quarterly Journal of Economics, 106(3), 709–737. https://doi.org/10.2307/2937924
Driscoll, J. C., & Kraay, A. C. (1998). Consistent covariance matrix estimation with spatially dependent panel data. Review of Economics and Statistics, 80(4), 549–560. https://doi.org/10.1162/003465398557825
Du, L., & Zheng, L. C. (2019). Effect evaluation of China’s green financial policy system: The analysis based on pilot operation data. Journal of Tsinghua University (Philosophy and Social Sciences), 34(1), 173–182. https://doi.org/10.13613/j.cnki.qhdz.002821
Flammer, C. (2021). Corporate green bonds. Journal of Financial Economics, 142(2), 499–516. https://doi.org/10.1016/j.jfineco.2021.01.010
Frank, M. Z., & Goyal, V. K. (2003). Testing the pecking order theory of capital structure. Journal of Financial Economics, 67(2), 217–248. https://doi.org/10.1016/S0304-405X(02)00252-0
Goss, A., & Roberts, G. S. (2011). The impact of corporate social responsibility on the cost of bank loans. Journal of Banking & Finance, 35(7), 1794–1810. https://doi.org/10.1016/j.jbankfin.2010.12.002
Greenstone, M., & Jack, B. K. (2013). Envirodevonomics: A research agenda for a young field (Working paper No. w19426). National Bureau of Economic Research. https://doi.org/10.3386/w19426
He, W., Fu, J., & Luo, Y. (2023). A study of well-being-based eco-efficiency based on Super-SBM and Tobit Regression Model: The case of China. Social Indicators Research, 167(1), 289–317. https://doi.org/10.1007/s11205-023-03107-8
He, L., Zhang, L., Zhong, Z., Wang, D., & Wang, F. (2019). Green credit, renewable energy investment and green economy development: Empirical analysis based on 150 listed companies of China. Journal of Cleaner Production, 208, 363–372. https://doi.org/10.1016/j.jclepro.2018.10.119
Ionescu, L. (2021). Leveraging green finance for low-carbon energy, sustainable economic development, and climate change mitigation during the COVID-19 pandemic. Review of Contemporary Philosophy, 20, 175–186. https://doi.org/10.22381/RCP20202112
Li, T. Y., & Liu, Y. (2020). The relationship of corporate bond credit spreads with the maturity mismatch between investment and financing. Financial Regulation Research, (10), 63–73. https://doi.org/10.13490/j.cnki.frr.2020.10.001
Lian, L. L. (2015). Does green credit influence debt financing cost of business? A comparative study of green businesses and “two high” businesses. Financial Economics Research, 9, 83–93.
Linnenluecke, M. K., Smith, T., & McKnight, B. (2016). Environmental finance: A research agenda for interdisciplinary finance research. Economic Modelling, 59, 124–130. https://doi.org/10.1016/j.econmod.2016.07.010
Liu, X., Wang, E., & Cai, D. (2019). Green credit policy, property rights and debt financing: Quasi-natural experimental evidence from China. Finance Research Letters, 29, 129–135. https://doi.org/10.1016/j.frl.2019.03.014
Liu, Y., & Bai, X. Y. (2020). Does Chinese stock market reward for going green? Based on enterprise sustainable development. Business and Management Journal, 42(01), 155–173.
Lu, J., Ren, L., Zhang, C., Rong, D., Ahmed, R. R., & Streimikis, J. (2020). Modified Carroll’s pyramid of corporate social responsibility to enhance organizational performance of SMEs industry. Journal of Cleaner Production, 271, Article 122456. https://doi.org/10.1016/j.jclepro.2020.122456
Luo, H., Jia, X. Y., & Wu, J. F. (2021). Internal control quality and maturity mismatch of enterprises’ investment and financing. International Financial Studies, (9), 76–85. https://doi.org/10.16475/j.cnki.1006-1029.2021.09.008
Lv, C., Shao, C., & Lee, C. C. (2021). Green technology innovation and financial development: Do environmental regulation and innovation output matter? Energy Economics, 98, Aricle 105237. https://doi.org/10.1016/j.eneco.2021.105237
Ma, Y. M., Hu, C. Y., & Liu, X. (2020). Issuing green bonds and enhancing corporate value: A mediation effect test based on the did model. Financial Forum, 25(09), 29–39. https://doi.org/10.16529/j.cnki.11-4613/f.2020.09.005
Mamun, M. A., Boubaker, S., & Nguyen, D. K. (2022). Green finance and decarbonization: Evidence from around the world. Finance Research Letters, 46(5), Article 102807. https://doi.org/10.1016/j.frl.2022.102807
Mishchuk, H., Czarkowski, J. J., Neverkovets, A., & Lukács, E. (2023). Ensuring sustainable development in light of pandemic “New Normal” Influence. Sustainability, 15(18), Article 13979. https://doi.org/10.3390/su151813979
Musova, Z., Musa, H., & Matiova, V. (2021). Environmentally responsible behaviour of consumers: Evidence from Slovakia. Economics and Sociology, 14(1), 178–198. https://doi.org/10.14254/2071-789X.2021/14-1/12
Ning, J. H., & Wang, M. (2021). Can green bonds alleviate “short-term financing and long-term investment” of enterprises? Empirical evidence from the bond market. Securities Market Herald, (09), 48–59.
Niu, H. P., Zhang X. Y., & Zhang P. D. (2020). Institutional change and effect evaluation of green finance policy in China: Evidence from green credit policy. Management Review, 8, 3–12. https://doi.org/10.14120/j.cnki.cn11-5057/f.2020.08.001
Olzhebayeva, G., Buldybayev T., Pavalkis D., Kireyeva, A., & Micekiene, A. (2023). Is there interest in green deal research in Central Asia? Economics and Sociology, 16(3), 302–322. https://doi.org/10.14254/2071-789X.2023/16-3/16
Omran, M. S., & Yaaqbeh, M. N. (2023). Climate change and business accountability, empirical evidence on the roles of environmental strategy and environmental accounting. Business Ethics, the Environment & Responsibility, 32(4), 1592–1608. https://doi.org/10.1111/beer.12591
Shi, B., & Wang, H. (2023). Green finance and improving habitat: Corporate financial strategic planning and risk regulation under the influence of green consumption behavior. Transformations in Business and Economics, 22(3a), 576–591.
Štreimikienė, D., Mikalauskienė, A., & Macijauskaitė-Daunaravičienė, U. (2022). Role of information management in implementing the Green Deal in the EU and the US. Journal of International Studies, 15(4), 9–27. https://doi.org/10.14254/2071-8330.2022/15-4/1
Volz, U. (2018). Fostering green finance for sustainable development in Asia (ADBI Working Paper, 814). SSRN. https://doi.org/10.2139/ssrn.3198680
Wang, C. W., Chiu, W. C., & King T. H. D. (2020). Debt maturity and the cost of bank loans. Journal of Banking & Finance, 112, Article 105235. https://doi.org/10.1016/j.jbankfin.2017.10.008
Wang, K. S., Sun, X. R., & Wang, F. R. (2019). Development of green finance, debt maturity structure and investment of green enterprise. Finance Forum, 24(7), 9–19. https://doi.org/10.16529/j.cnki.11-4613/f.2019.07.003
Wang, Y. L., Lei, X. D., & Long, R. Y. (2021). Can green credit policy promote the corporate investment efficiency. China Population, Resources and Environment, 31(1), 123–133.
Wu, H. Y., & Yin, D. S. (2021). The reward and penalty effects of the green credit policy on corporate debt financing: An effect evaluation based on a quasi-natural experiment. Contemporary Finance & Economics, 02, 49–62. https://doi.org/10.13676/j.cnki.cn36-1030/f.2021.02.006
Zhang, R., Li, Y., & Liu, Y. (2021a). Green bond issuance and corporate cost of capital. Pacific-Basin Finance Journal, 69(10), Article 101626. https://doi.org/10.1016/j.pacfin.2021.101626
Zhang, X. M., & Ye, Z. W. (2021). Obtaining trust helps? Does social trust mitigate investment with short-term financing? Foreign Economics & Management, 43(1), 44–57. https://doi.org/10.16538/j.cnki.fem.20200816.201
Zhong, K., Cheng, X. K., & Zhang, W. H. (2016). The moderating level of monetary policy and the mystery of short loans used as long investments by enterprises. Journal of Management World, (03), 87–98. https://doi.org/10.19744/j.cnki.11-1235/f.2016.03.008
Zhou, X. X., Jia, M. Y., & Zhao, X. (2023). An Empirical study and evolutionary game analysis of green finance promoting enterprise green technology innovation. China Industrial Economics, (06), 43–61. https://doi.org/10.19581/j.cnki.ciejournal.2023.06.002
Zhu, J. M., Wang, J. L., Yu, Z. Q., Yang, S. Y., & Wen, Q. X. (2020). Policy effectiveness of green finance: market reaction to the issuance of green bonds in China. China Public Administration Review, 2(2), 21–43.
Zou, J. J. (2017). Green finance policy, policy synergy and industrial pollution intensity: A perspective of policy text analysis. Financial Theory & Practice, (12), 71–74.