Research On The Impact Of ESG Performance On Commercial Credit Financing

With the concept of green development deeply rooted in people’s minds,environmental protection has become an important issue.Driven by the goal of "double carbon",China’s laws and regulations on corporate environmental,social and corporate governance information disclosure are improving day by day.The release of the Reform Plan for the Legal Disclosure System of Environmental Information and the Guidelines for the Legal Disclosure Format of Corporate Environmental Information has promoted the development of ESG in China’s capital market while practicing the concept of green development.For enterprises,from the perspective of ESG(Environmental,Social and Governance),observing their environmental protection,risk resistance and sustainable development capabilities has become an innovative way of enterprise evaluation.As of June 2021,A share and Hong Kong share listed companies have disclosed a total of 2344 ESG reports in 2021,with an average disclosure ratio of 40.33%.The disclosure ratio of A share listed companies is as high as 30.18%.The number of enterprises actively disclosing ESG related information of enterprises is increasing year by year,and the disclosure ratio is gradually increasing.Whether the ESG practice of enterprises can attract the attention of suppliers and bring financing channels to enterprises,the research on these issues will help promote the sustainable development of enterprises.Therefore,from the perspective of enterprise ESG performance,this paper constructs a multi period double difference model and an OLS model,selects A-share non-financial listed companies from 2012 to 2020 as the research sample,and explores the impact of enterprise ESG performance on commercial credit financing and its mechanism.The research results show that:(1)enterprise ESG performance can attract the attention of suppliers,and has the role of promoting enterprise commercial credit financing.The robustness of possible endogenous problems in this paper was tested by Heckman two-stage,extended observation window,tool variable,alternative explanatory variable,etc.The results show that the conclusions in this paper are still valid after considering possible endogenous problems;(2)Through the effect of signal transmission and supervision,enterprise ESG performance information disclosure can improve the information transparency and reduce the financial risk of enterprises,thus improving the commercial credit financing of enterprises;The ESG performance of enterprises is a characteristic information of enterprises.A good ESG performance can promote enterprises to obtain more commercial credit financing by increasing the shareholding of investors,reducing the operational risk of enterprises and reducing the risk of default;(3)Further analysis found that the role of enterprise ESG was different under different internal and external supervision mechanisms.When the analyst’s attention is high,it can form a good complementary relationship with the relevant information of ESG,and significantly promote the business credit financing of enterprises.Because of the differences in the level of marketization,the enterprise’s ESG plays a stronger role in promoting the business credit financing in regions with poor marketization.The main contributions of this paper are as follows: First,the existing literature focuses on the separate inspection of environment,social responsibility and corporate governance.There are relatively few literatures on how to integrate the three into a whole(ESG)to study its impact on business credit financing.This paper first studies the impact on commercial credit financing after the disclosure of ESG performance information of listed companies by building a multi period double difference model,which not only enriches the relevant literature on the economic consequences of ESG performance,but also expands the research perspective on the influencing factors of commercial credit financing.Second,it discusses the impact of ESG performance on commercial credit financing,providing the latest evidence from China for enterprises’ ESG performance to ease financing constraints and promote business credit financing,and also providing theoretical reference for enterprises to improve their ESG performance;Thirdly,based on the fact that China’s capital market has made it clear that enterprises’ ESG performance can improve their commercial credit financing,this paper further discusses the mechanism,which is conducive to providing more targeted suggestions for Chinese enterprises to improve their ESG performance and obtain commercial credit financing.