Research On The Impact Of Issuing Green Bonds On Corporate Profitability

In the face of the current severe environmental problems,China has actively implemented the green development strategy,deeply promoted green financial innovation,and provided impetus for high-quality economic development.As a component of green finance,green bonds have unique advantages.On the one hand,they provide new financing channels for enterprises,and on the other hand,they also promote the development of environmental protection in China.Relevant domestic and foreign research documents have made many discussions on different directions in the field of green bonds,but there are still debates on whether green bonds can promote the growth of corporate profitability,and there are few studies on the transmission mechanism of the impact of green bonds on corporate profitability;The green environmental protection attribute of green bonds often improves the company’s social evaluation,which may affect the company’s profitability,which is often ignored by many researchers.Therefore,on the basis of studying the relevant literature of the issuance of green bonds,this paper explores the impact of the issuance of green bonds on the company’s profitability and explores its impact mechanism.This paper first sorts out the current situation of the development of green bonds,analyzes and summarizes the problems and experiences,and then,based on the information asymmetry theory,signal transmission theory and social responsibility investment theory,analyzes that the issuance of green bonds has a positive impact on the company’s profitability,and exerts an impact on the company’s profitability through financing costs and public social evaluation of the company.On the basis of this analysis,this paper puts forward three major assumptions,The hypothesis is verified by an empirical model.In the empirical part,this paper selects the A-share non-financial industry listed enterprises data from 2010 to 2021 as the sample data,introduces the multi-period DID model in the field of policy research,regards the issuance of green bonds by enterprises as a policy impact,and studies the impact of green bonds on the profitability of listed companies.Then,using the intermediary effect model,taking the company’s financing cost and the company’s social evaluation,namely the company’s ESG rating,as the intermediary variables,we study the impact mechanism of green bonds on the company’s profitability.The research found that:(1)the issuance of green bonds by companies can improve their profitability;(2)The issuance of green bonds reduces the financing cost and thus improves the profitability of the company.The disclosure of enterprise environmental information can effectively alleviate the information asymmetry,transmit positive signals to the market,so as to raise the market’s attention and reduce investors’ risk expectations.At the same time,it can also enjoy the preferential policies of government subsidies,so as to reduce the financing costs of enterprises and improve the profitability of enterprises;(3)The issuance of green bonds can also improve the company’s profitability by improving the company’s public responsibility evaluation.Green bonds have the green attribute,which makes the company’s shares gain the attention of socially responsible investors.In addition,enterprises can demonstrate their strength by taking the initiative to assume social responsibility,gain market recognition and improve the expectations of investors and potential customers,and then improve the performance of enterprises in the market;(4)Companies in different industries and regions can obtain different profits from issuing green bonds.Based on the domestic green bond development problems and empirical conclusions,this paper puts forward five countermeasures and suggestions,hoping to make all parties have a clearer understanding of green bonds,so as to promote its healthy development and make it play a better role in the transformation of China’s economic development mode.