China's Green Credit Implementation Status And Effectiveness Evaluation

In order to achieve effective control of highly polluting,high energy-consuming and other heavily polluting industries,enterprises are urged to internalize the cost of pollution so as to achieve the effect of advance management.The former State Environmental Protection Administration,the Central Bank,and the former China Banking Regulatory Commission issued the “About Implementation” in July 2007.“Opinions on Preventing Credit Risks from Environmental Protection Policies and Regulations”,which pointed out that credit approvals for enterprises and projects that are inconsistent with industrial requirements and environmental laws and regulations are controlled,and that economic leverage is used to guide them to focus on environmental protection and curb blind expansion.It marks the official start of China's green credit.The implementation of green credit has led banks to further increase their corporate loan requirements,because in addition to reviewing the company's conventional credit requirements,banks also need to examine whether the company's production and operation are in compliance with environmental protection requirements,and regard it as a prerequisite for the passage of This guides companies to increase their awareness of environmental protection.This measure not only makes the operation of banks and enterprises consistent with the requirements of sustainable development,but may also improve profits by reducing the risks of banks.Therefore,this paper studies the status quo of China's green credit implementation and its effect evaluation,and has important implications for the future development of banking financial institutions and their own development,the accurate formulation of policies,and the improvement of environmental quality.First of all,this article takes 48 listed companies that disclosed environmental information for six consecutive years from 2010 to 2015 as research objects,and they have two external performances(total borrowings and total long-term borrowings)and direct performance(borrowing costs)from the implementation of green credit.From the perspective of the evaluation of the implementation effect of green credit,the results show that the more the company focuses on the environmental impact,that is,the higher the quality of environmental information disclosure,the greater the total amount of borrowing it obtains,but the positive correlation with its long-term borrowing is not significant;Focus on the impact on the environment that the higher the quality of environmental information disclosure,the lower the cost of obtaining loans.This result shows that the implementation of China's green credit has a certain effect,but it is only reflected in the short-term loans of the company.Secondly,this paper takes the top 10 commercial banks in China as the research object,empirically examines the impact of commercial banks' green credit on their profitability,and then analyzes the reasons why China's green credit implementation is only reflected in short-term loans.The research results show that there is a negative correlation between the implementation of green credit and the profitability of China's commercial banks.The level of green credit may weaken the profitability of commercial banks.This explains to a certain extent that the implementation effect of green credit in China is only reflected in the Reasons for short-term borrowings.It is precisely because commercial banks may not be able to benefit from the implementation of green credit.Commercial banks will have stronger risk awareness when they approve credit applications from heavily polluting enterprises,and are reluctant to issue long-term loans with higher risks;they are willing to apply for long-term loans.For enterprises,although efforts to increase environmental protection can be applied for more loans from banks and the cost is lower,but more can only get short-term loans,so the enthusiasm to implement environmental protection is not high.Finally,this article analyzes the problems existing in the development of green credit from the perspectives of banks,enterprises,and government,and puts forward corresponding suggestions.