Capital market opening and corporate environmental performance: Empirical evidence from China

Rongwu Zhang, Wenqiang Fu and Tong Lu

Finance Research Letters, 2023, vol. 53, issue C

Abstract: This study investigates the impact of capital market opening on corporate environmental performance (CEP), using Shanghai-Hong Kong Stock Connect and Shenzhen-Hong Kong Stock Connect as quasi-natural experiments. We find that capital market opening can improve CEP, and our conclusion is robust after a placebo test and a series of robustness tests are conducted. Further investigations show that the opening policy loosens corporate financing constraints and promotes corporate green innovations. We also explore the motivation of this relationship: the improvement of CEP after the opening of the capital market is accompanied by increases in corporate value.

Keywords: Capital market opening; Corporate environmental performance; Financing constraints; Green innovations (search for similar items in EconPapers)
Date: 2023
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (13)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:finlet:v:53:y:2023:i:c:s1544612322007632

DOI: 10.1016/j.frl.2022.103587

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