Green finance policies and corporate environmental, social, and governance performance

Yuyang Zhang and Ningning Zhang

Finance Research Letters, 2025, vol. 81, issue C

Abstract: This study examines the impact of green finance policies on the environmental, social, and governance (ESG) performance of Chinese nonfinancial listed companies using data from 2011 to 2022 and applying the difference-in-differences methodology. Findings reveal that these policies significantly enhance ESG performance, with notable variations across firms based on ownership structure and commercial credit levels. Green finance policies foster ESG improvements by stimulating research and innovation while easing corporate financing constraints. A firm size threshold effect is identified, where smaller enterprises benefit more from these policies, whereas larger firms may face transition challenges.

Keywords: Green finance policy; ESG performance; Financing constraints (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eee:finlet:v:81:y:2025:i:c:s1544612325006816

DOI: 10.1016/j.frl.2025.107421

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