The Impact Of ESG Ratings On Spreads Of Green Bond Issuance

“The report of the 20th National Congress” points out that we should promote the construction of a beautiful China,accelerate the construction of green lifestyles,develop green and low-carbon industries,advocate green consumption and promote the harmonious coexistence of man and nature.China has incorporated “carbon peaking and carbon neutral” into a major national strategy,and has made a series of top-level designs and arrangements.The Action Plan for Carbon Neutrality by 2030,which was released in October 2021,aims to achieve the ambitious goal of“achieving carbon neutrality by 2060”.To achieve this goal,it is necessary to restructure the market,optimise the energy mix to improve unit efficiency and promote the construction of carbon markets,while financial policies also play an important role in promoting carbon emissions.Green bonds are an integral part of China’s green financial system,embodying both the concept of “financial services”and the practice of “green ecology”,and providing a strong support for social development.As a “green finance” product,green bonds are different from traditional bank credit in that their main feature is their strong environmental benefits.The Chinese government is actively promoting the development of a green bond market to facilitate investment in environmental protection and to achieve sustainable development.This paper combines the China Bond Information Network,CSMAR database and Wind database to collect all green bonds issued by Chinese listed companies in China from 2016-2021,and finally obtains 208 green bonds issued by 76 listed companies as a sample,selects the ESG rating of China Securities as an explanatory variable,and conducts an empirical study to explore in depth whether ESG rating will have an impact on the green The study found that the higher the ESG rating,the higher the ESG rating.The results of the study found that the better the ESG rating,the lower the credit spreads of green bonds issued by companies.After an in-depth study,we found that the effect of ESG ratings on green bond issuance spreads was more pronounced in companies with lower equity concentration,while the effect of ESG ratings on green bond issuance spreads was more prominent in state-owned enterprises than in non-state-owned enterprises.After mechanism analysis,we find that companies with higher ESG ratings will have lower information asymmetry,higher audit quality and greater innovation capacity,which will result in much lower spreads for companies issuing green bonds.Finally,a robustness test was conducted after two-stage least squares(2SLS)and substitution of the main explanatory variables to ensure the reliability of the results obtained in the article.This paper draws three important conclusions:(1)The government should take effective measures to strengthen the regulation of the green bond market and ESG investment concept and improve the relevant regulatory system to ensure its sustainable development.(2)ESG ratings can serve as an important reference indicator that helps investors and companies to share information with each other,thereby reducing information asymmetry problems.(3)from the perspective of companies,they can actively improve their ESG performance,further reduce their financing costs through the issuance of green bonds,and improve their recognition in the market.