Bank-firm common ownership, green credit and enterprise green technology innovation: Evidence from Chinese credit markets

Minghao Liu, Kun Xu and Lihong Zhai

Energy Economics, 2024, vol. 140, issue C

Abstract: Bank-firm common ownership can tackle the innovation dilemma of bank loans on firms' green development. This paper constructs indicators of common ownership and green technological innovation and then investigates the impact of bank-firm common ownership on corporates' green technological innovation using Chinese A-share listed enterprises samples from 2004 to 2021. Our conducted experiments reveal that bank-firm common ownership shareholders not only make banks and lending firms have the same goal, promote the total level, quantity, and quality of technological innovation for the green development of lending firms, and profit from the firms' short- and long-term market responses. Our findings are prominent in private enterprises, small-capitalization enterprises, and bull market cycles. In addition, we discover that shareholder reduction restrictions and policies restricting corporate shareholding in financial institutions enhance bank-firm common ownership shareholders on corporate green technological innovation development. Common ownership shareholders reduce information asymmetry between banks and lending enterprises and provide green loans to support enterprise green technology innovations. Furthermore, alleviating financing constraints and strengthening the supervisory role are important influence mechanisms. In this regard, carried PSE analysis indicates the direct effect of bank-firm common ownership shareholders to promote enterprise green development of technological innovation accounts for about 41% of the total effect, the intermediary effect of “financing mechanism” and “supervision mechanism” account for about 50% and 9%, and the “financing mechanism” is more important than the “supervision mechanism.” The findings of this paper can optimize the credit market to serve the green and high-quality development of Chinese enterprises better.

Keywords: Bank-firm common ownership shareholding; Green credit; Green technology innovation; Financing constraints; Banking supervision; High-quality development (search for similar items in EconPapers)
JEL-codes: G20 L21 O31 (search for similar items in EconPapers)
Date: 2024
References: Add references at CitEc
Citations:

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0140988324007229
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:eneeco:v:140:y:2024:i:c:s0140988324007229

DOI: 10.1016/j.eneco.2024.108014

Access Statistics for this article

Energy Economics is currently edited by R. S. J. Tol, Beng Ang, Lance Bachmeier, Perry Sadorsky, Ugur Soytas and J. P. Weyant

More articles in Energy Economics from Elsevier
Bibliographic data for series maintained by Catherine Liu ().