| The development of economic activities and the development of social progress indexes have forced the government to think about the environmental challenges.As a key player in the emerging market,Chinese companies need to not only follow a green economic development strategy,but also take responsibility for actively addressing environmental challenges.With China’s rapid economic growth and serious industrial pollution,how to promote green and sustainable economic development as well as high-quality economic growth has been an important issue in China’s current economic development.Recently,the Chinese government has adopted various administrative,tax and technical measures to protect the environment,but the results are not obvious.Since substantial improvement of the ecological environment depends not only on stronger end-of-pipe governance measures,but also on the use of financial instruments to change the incentive mechanism of resource allocation.Green credit,as one of the financial instruments,plays a key role in sustainable development according to the theory of credit rationing basis.In view of this,this paper explores the impact of green credit on corporate sustainable development performance and its impact mechanism,trying to answer such practical questions as: What are the current characteristics of green credit in China? Is there an incentive effect of green credit? What is the impact of green credit on corporate sustainability performance? What are its specific mechanisms of action? Can green credit policies be effective on the sustainable development performance of enterprises? The answers to these questions help to provide theoretical basis for the formulation and improvement of green credit policy,and provide empirical evidence for promoting corporate sustainable development.To address the above questions,this paper,firstly,draws on the theoretical model of Annicchiarico and Di Dio(2015)to construct a theoretical analytical framework for green credit to affect the sustainable development performance of enterprises by considering a static model that includes enterprises and banks,and on this basis,the main impact mechanisms are elaborated.Second,a DSGE model including households,manufacturers,commercial banks,entrepreneurs,central banks and governments is constructed to test the incentive effects of green credit.Then,an econometric model is constructed based on the theoretical analysis and incentive effect test to empirically test the impact,heterogeneity analysis and impact mechanism of green credit on corporate sustainability performance from the empirical facts of green credit and corporate sustainability performance in China,using panel data of A-share listed manufacturing companies from 2008-2019,and a series of robustness tests to deal with the possible endogeneity issues.Again,the impact of green credit policies on corporate sustainability performance is evaluated.Finally,based on a series of findings,targeted policy recommendations are proposed.The main findings of this paper are as follows.First,drawing on the theoretical model of Annicchiarico and Di Dio(2015),this paper assumes that firms have heterogeneous production technologies.To determine the interest rate,we assume that each bank has sufficient bargaining power to set a lending rate for each firm borrowing,and that banks introduce differentiation between green credit and no bank credit to analyze firms’ measures for pollution abatement.The theoretical analysis shows that firms that do not reduce pollution will face increasing financing costs,and that green credit will induce firms without abatement measures to switch to abatement measures,and will increase firms’ profits,which in turn will improve firm performance.Further discussing the mechanism of green credit’s impact on corporate sustainability performance,we find that green credit affects corporate sustainability performance through green innovation and financing constraints.Moreover,it is affected by the moderating effects of monetary policy,environmental regulations and government subsidies in the process.Second,the factual analysis of the characteristics of green credit and corporate sustainability performance shows that: in terms of green credit,there is an overall upward trend from 2007-2019;and the largest use of funds is for green transportation projects;and green credit is higher in more market-oriented regions.In terms of corporate sustainable development performance,the financial performance of state-owned enterprises is higher than that of private enterprises,but the environmental social responsibility performance of private enterprises is higher than that of state-owned enterprises;the financial performance and environmental social responsibility performance of enterprises in regions with high marketization levels are higher than those in regions with low marketization levels;after the promulgation and implementation of the Green Credit Guidelines in 2012,the financial performance and environmental social responsibility performance of enterprises in highly polluting industries are After the promulgation and implementation of the Green Credit Guidelines in 2012,the financial performance and environmental and social responsibility performance of enterprises in high-pollution industries are higher than those in polluting industries.Third,the test of incentive effect of green credit shows that the analysis of DSGE model classifies enterprises into green and polluting types and finds that both price-based green credit with external financing premium and quantity-based green credit with increased supply of short-term loans and medium-and long-term loans contribute to green transformation of enterprises,green upgrading of industrial structure and positive environmental effects.Fourth,the results of the empirical analysis of green credit on corporate sustainability performance show that(1)green credit improves corporate financial performance while improving environmental and social responsibility performance,which in turn has a positive effect on corporate sustainability performance,and the results are very robust.The promotion effect of green credit on corporate sustainability performance is relatively higher in state-owned enterprises,the more market-oriented enterprises they are located in,and in high technology-intensive industries.(2)The test of intermediation mechanism shows that green innovation and financing constraints are important channels through which green credit affects the sustainable development performance of enterprises.Among them,green innovation plays a dominant role.(3)The moderating mechanism test shows that loose monetary policy positively moderates the relationship between green credit and green innovation,and monetary policy has a front-end positive moderating effect on the green innovation mediating path.Environmental regulations and government subsidies positively regulate the impact of green credit on corporate sustainability performance.Fifth,the results of assessing the policy effects of green credit on corporate sustainability performance show that(1)green credit policy significantly improves corporate financial performance and environmental social responsibility performance,i.e.,green credit policy enhances corporate sustainability performance,and this effect is robust through a series of robustness tests;the effect of green credit policy on corporate sustainability performance is significant among large-scale enterprises,state-owned enterprises,The positive policy effect of green credit policy on corporate sustainability performance is stronger in large-scale enterprises,state-owned enterprises,enterprises with a higher percentage of fixed assets,and enterprises in regions with a higher level of marketization.(2)The results of the intermediation mechanism suggest that green credit policy will affect the sustainable development performance of enterprises through green innovation and financing constraints.After the implementation of green credit policy,the financial performance of light polluting enterprises with loose financing constraints is significantly higher than that of light polluting enterprises with tight financing constraints;the environmental social responsibility performance of heavy polluting enterprises with loose financing constraints is significantly higher than that of heavy polluting enterprises with tight financing constraints.(3)Environmental regulation and government subsidies positively regulate green credit policy to affect the sustainable development performance of enterprises.Loose monetary policy positively moderates the relationship between green credit policy and green innovation.The conditional process effect of monetary policy finds that the conditional indirect effect grows slowly with increasing values of the moderating variables,i.e.,monetary policy positively moderates the mediating effect of green innovation in green credit policy and firm sustainability performance. |
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