Research On The Impact Of Enterprise Environmental Credit Evaluation On Debt Capital Cost

In the process of rapid economic development in China,people’s material and cultural living standards have been greatly improved.However,in our real life,various behaviors that pollute the environment occur from time to time.People’s production and lifestyle have brought many negative impacts on the ecological environment and natural resources,which is obviously not conducive to the long-term social development.In this situation,the government has launched an environmental credit evaluation system,which serves as an operational mechanism and a management tool for monitoring the environmental performance of enterprises.It is also a tool for corporate governance.Under the guidance of environmental protection laws and relevant rules,the environmental protection departments in various provinces and cities evaluate the performance of enterprises in pollution control,environmental behavior management,environmental protection capacity and so on.Finally,they will form an environmental credit rating and make it public,guiding enterprises to strengthen environmental protection behavior and responsibilities.At present,most of the literature focuses on the institutional development and practical application of environmental credit evaluation.However,there is little empirical testing of the economic consequences of the environmental credit evaluation system.Further exploration is needed on whether and how this system has played a roleIn this thesis,the current research status of environmental credit evaluation system is reviewed and summarized firstly.It is found that there are still imperfections in the current research.Then,based on organizational legitimacy theory,social responsibility theory,information asymmetry theory,and risk assessment theory,a theoretical analysis framework for environmental credit evaluation and debt capital cost is proposed.Secondly,taking listed companies participating in environmental credit evaluation from 2011 to 2021 as samples,this thesis empirically tests the relationship between corporate environmental credit and debt capital cost as well as analyzing whether this relationship will differ among different subjects.It also further expands how corporate environmental credit affects the cost of debt capital.The main research conclusions of the article are as follows.(1)There is a significant negative correlation between environmental credit rating and debt capital cost.(2)The negative correlation between environmental credit and debt capital cost exhibits heterogeneity among different types of entities.When the internal governance environment is poor,the level of marketization is low and the nature of property rights is non-state-owned,the negative correlation between environmental credit rating and debt capital will be more obvious.(3)In the relationship between environmental credit and debt capital cost,government subsidies and financial risk play a mediating role.Environmental credit rating is conducive to showcasing a good corporate image,gaining consumer support,improving corporate competitiveness,reducing financial risks,making it easier to obtain government subsidies and reducing the debt and capital costs of enterprises.Finally,the article proposes policy suggestions from three aspects: government,enterprises,and financial institutions such as banks.This thesis enriches the research on the factors influencing the cost of debt capital from the perspective of corporate environmental behavior and adds literature on the economic consequences of corporate environmental credit.It also explores the mechanism of environmental credit influencing economic behavior,which is beneficial for the government to timely improve relevant systems.What’s more,it can guide banks and other financial institutions to increase the application of environmental credit results.At the same time,it also provides inspiration and reference for enterprises to attach importance to environmental credit evaluation work.