Does it pay to go green? The impact of green bond issuance on corporate performance

Han Yu, Radu Burlacu () and Geoffroy Enjolras
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Han Yu: CERAG - Centre d'études et de recherches appliquées à la gestion - UGA - Université Grenoble Alpes
Radu Burlacu: CERAG - Centre d'études et de recherches appliquées à la gestion - UGA - Université Grenoble Alpes

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Abstract: Using a sample of 145 first-time green bond issuers and 2,225 non-issuers in 10 countries/regions from 2014 to 2019, we conduct a Propensity Score Matching combined with a Difference-in-Difference analysis to examine the impact of green bond issuance on firms' long-term environmental and financial performance. By comparing changes after green bond issuance between issuers and a paired control group, we find a significant improvement in financial performance two years after issuance but no significant changes in environmental performance. These effects vary among issuers in different sectors and countries. Notably, only issuers in the industrial and energy sectors experience real benefits from green bond issuance. Furthermore, the improvement in corporate performance appears with a lag of approximately two years.

Keywords: Green bonds; Corporate financial performance; Corporate environmental performance; Propensity Score Matching (PSM); Difference-in-Difference (DID); G24; O16; Q50 (search for similar items in EconPapers)
Date: 2025
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Published in Bankers, Markets and Investors, 2025, N° 182 (182), pp.53-67. ⟨10.54695/bmi.182.0053⟩

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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-05542598

DOI: 10.54695/bmi.182.0053

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