Green investments and their effect on ESG ratings: An empirical analysis of Chinese publicly traded companies

IF 6.3 2区经济学 Q1 BUSINESS, FINANCE

Research in International Business and Finance Pub Date : 2024-11-24 DOI:10.1016/j.ribaf.2024.102670

Bo Hou , Wenhui Huang , Xiji Wang , Jizhou Wang

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引用次数: 0

Abstract

The effect of green investments on the Environmental, Social, and Governance (ESG) ratings of Chinese publicly listed corporations is investigated in this research. We investigate the differences in ESG performance between state-owned companies (SOEs) and non-state-owned enterprises (NSOEs) using data covering 2009–2023 using a Linear mixed-effect model. Our results reveal that, especially in NSOEs, green investments greatly improve the environmental and social elements of ESG ratings; SOEs exhibit better governance ratings as a result of these investments. The study also emphasizes how diverse the ownership structure affects ESG ratings, thereby reflecting distinct strategic goals and regulatory effects. The findings imply that adopting green investments not only raises ESG ratings but also helps to lower environmental risks and enhance stakeholder interactions, thereby supporting the dual benefits of sustainability practices. Policymakers should take into account using incentives that promote long-term sustainability objectives, including tax exemptions or subsidies for businesses embracing environmentally friendly practices, thereby improving the effect of green investments.

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来源期刊

Research in International Business and Finance BUSINESS, FINANCE-

CiteScore

11.20

自引率

9.20%

发文量

240

期刊介绍： Research in International Business and Finance (RIBAF) seeks to consolidate its position as a premier scholarly vehicle of academic finance. The Journal publishes high quality, insightful, well-written papers that explore current and new issues in international finance. Papers that foster dialogue, innovation, and intellectual risk-taking in financial studies; as well as shed light on the interaction between finance and broader societal concerns are particularly appreciated. The Journal welcomes submissions that seek to expand the boundaries of academic finance and otherwise challenge the discipline. Papers studying finance using a variety of methodologies; as well as interdisciplinary studies will be considered for publication. Papers that examine topical issues using extensive international data sets are welcome. Single-country studies can also be considered for publication provided that they develop novel methodological and theoretical approaches or fall within the Journal''s priority themes. It is especially important that single-country studies communicate to the reader why the particular chosen country is especially relevant to the issue being investigated. [...] The scope of topics that are most interesting to RIBAF readers include the following: -Financial markets and institutions -Financial practices and sustainability -The impact of national culture on finance -The impact of formal and informal institutions on finance -Privatizations, public financing, and nonprofit issues in finance -Interdisciplinary financial studies -Finance and international development -International financial crises and regulation -Financialization studies -International financial integration and architecture -Behavioral aspects in finance -Consumer finance -Methodologies and conceptualization issues related to finance