How Does Green Credit Policy Affect Sustainable Development Capacity of Enterprises in China?

How Does Green Credit Policy Affect Sustainable Development Capacity of Enterprises in China?

Liangliang Han, Shangshu Liu
Copyright: © 2023 |Pages: 19
DOI: 10.4018/jgim.320487
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Abstract

The green credit policy has been one of the most important policies for solving resource and environmental problems and promoting sustainable economic and social development in China in recent years. Based on the mediating effect of green innovation input and the moderating effect of government subsidies, in this study the authors investigate the influence of the green credit policy on the sustainable development capacity of enterprises. The research shows that the green credit policy does not improve the sustainable development capacity of enterprises. The green credit policy promotes enterprises' green innovation input, and green innovation input plays an intermediary role between green credit policy and sustainable development capacity of enterprises. Government subsidies play a regulating role in the green credit policy, green innovation input, and sustainable development capacity of enterprises. Based on these findings, the authors suggest that the government, banks, and enterprises make joint efforts to improve the sustainable development capacity of enterprises as soon as possible.
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Literature Review

In recent years, scholars have conducted research on green finance, the GCP, green innovation, and sustainable development capacity—and have achieved relatively fruitful research results. The relevant main literature can be roughly subdivided into four areas:

The first area includes the theoretical research on green finance and its impact on carbon emissions. Nedopil et al. (2021) studied the nature, evolution, and differences of green finance standards. Deng et al. (2022) explored the construction and measurement of green finance development indicator systems of commercial banks. Xu et al. (2022) studied how environmental regulations affect the development of green finance. Hu and Tu (2022) explored the effect of green finance on high-quality development of enterprises. Ba and Peng (2022) reviewed the practice of green finance in the UK to provide reference for the development of green finance in China. Wu (2021) found that green finance plays an important catalytic, supporting, and boosting role in accelerating the green and low-carbon development of the economy, and promoting the comprehensive green transformation of economic and social development. A. Zhang et al. (2022) showed that green credit policies have a greater impact on industrial carbon emission intensity for countries with a low state-owned capital ratio, a high total-factor productivity, and a high capital dependence. Hu and Zheng (2021) found that green credit has a significant inhibitory effect on carbon emissions.

The second area of the literature covers the impact of the GCP on enterprise investment and financing. J. Zhang et al. (2022) found that the GCP can improve the efficiency of enterprises’ overseas investment, especially for state-owned enterprises and enterprises in regions with fewer environmental laws and regulations. Xu and Li (2020) found that the GCP can increase the debt financing cost and reduce the debt financing term of enterprises with high pollution and emission levels, but reduce the debt financing cost of green enterprises. Su and Lian (2018) showed that green credit had significant financing penalty effects and investment inhibitory effects.

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