The spillover effect of green bond issuance on corporate financial performances: evidence from China

Mingyu Hu (), Xinyin Zhang () and Yeyu Zhang ()
Additional contact information
Mingyu Hu: Tsinghua University
Xinyin Zhang: Peking University
Yeyu Zhang: Dalian University of Technology

Review of Quantitative Finance and Accounting, 2025, vol. 64, issue 4, No 4, 1567-1593

Abstract: Abstract In the context of global warming and environmental protection, the green bond market has been experiencing remarkable growth, necessitating a thorough examination of how companies interpret and react to the “green signals” communicated by these bonds. This study aims to delve into the spillover impact of green bond issuance on the financial performance of peer firms within the same industry. Utilizing panel data from China’s listed companies between 2010 and 2022, we observed that the issuance of green bonds by companies positively influences the financial performance of their peers within the same industry, a phenomenon we term as the “spillover effect”. Furthermore, our analysis suggests that this spillover effect can be attributed to three potential influential mechanisms: market competition, green behaviors, and government subsidies. Specifically, intense market competition enhances the positive spillover effect, while the issuance of green bonds encourages peer companies to adopt environmentally friendly practices and increases their chances of receiving government subsidies. Additionally, our findings indicate that this positive influence is more pronounced in non-polluted sector and among companies with lower financial constraints. These insights provide valuable practical implications for policymakers and managers in promoting green and sustainable development.

Keywords: Green bond issuance; Spillover effect; Peer firms; Financial performance; Sustainable development (search for similar items in EconPapers)
JEL-codes: G12 G30 (search for similar items in EconPapers)
Date: 2025
References: Add references at CitEc
Citations:

Downloads: (external link)
http://link.springer.com/10.1007/s11156-024-01343-8 Abstract (text/html)
Access to full text is restricted to subscribers.

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:kap:rqfnac:v:64:y:2025:i:4:d:10.1007_s11156-024-01343-8

Ordering information: This journal article can be ordered from
http://www.springer.com/finance/journal/11156/PS2

DOI: 10.1007/s11156-024-01343-8

Access Statistics for this article

Review of Quantitative Finance and Accounting is currently edited by Cheng-Few Lee

More articles in Review of Quantitative Finance and Accounting from Springer
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().