What is the impact of green credit on China s environmental pollution?

Mondo Social Updated on 2024-01-31

At present, while China's economic construction has made significant progress, the negative effects of environmental pollution are becoming more and more obvious, and this problem not only damages the international image, but more importantly, it has become a burden on China's economic development path.

According to data provided by the World Bank, China ranked first in global carbon dioxide emissions in 2021, with emissions of 1052.3 billion tons, and the United States is in second place, with 470.1 billion tons. In addition, the situation of water pollution and waste pollution is not optimistic. This shows that as China's reform and opening up has entered a critical period, economic growth has slowed down, and it is urgent to improve the negative effects of environmental pollution on economic construction.

China's means of improving the ecological environment and reducing environmental pollution are constantly developing. In the era when the financial industry was not yet developed, China often used administrative means to control pollutionFor example, the formulation of environmental protection policies, the division of nature reserves, etc., these measures are simple and direct, but the sustainability and feedback are not strong, and there is no market mechanism to supplement them, and the emergence of green finance has filled this gap.

Green finance uses financial means to coordinate economic growth and environmental governance, and green credit is currently the most widely used and largest in China. However, since the concept of green credit was proposed, scholars have different opinions on whether environmental pollution control is effective. Foreign scholars mostly use bank green loans as their measurement indicators. The indicators were measured from multiple levels such as green loans.

A number of representative banks were selected and the volume of new loans from these banks was used as a measure. A measure of the level of green credit should be a combination of the number of Equator banks and the balance of green loans. The measurement of green credit by domestic scholars can be roughly divided into four types:The proportion of interest in the six high-energy-consuming industries, policy dummy variables, the balance of green credit of commercial banks, and the amount of loans for energy conservation and environmental protection.

Most scholars use the ratio of interest expenses of the six high-energy-consuming industries to the total interest expenses of the industrial industries in each region to measure green credit: In the study, the proportion of interest expenses of the six high-energy-consuming industries is used to measure the level of green creditThe study confirms that green credit significantly reduces CO2 emissions;Research confirms that green credit reduces carbon emissions by improving energy efficiency;Research confirms that green credit inhibits regional carbon emissions.

Some scholars use policy dummy variables to measure green credit: at the disclosure time point of the green credit balance in the "Social Responsibility Report" of each commercial bank, the focus is on the year in which the commercial bank carried out the green credit business, so as to constitute the green credit dummy variableScholars have taken the Green Credit Guidelines triggered by the former China Banking Regulatory Commission in 2012 as an exogenous green finance policy impact and constructed a quasi-natural experiment.

When studying the relevant issues of commercial banks, scholars often directly use the green credit balance of commercial banks to measure the level of green credit: the study confirms that green credit promotes the technological innovation of environmentally friendly enterprises;The study confirms that green credit has a significant role in promoting the optimization of industrial structureIt was found that green credit can improve the profitability and liquidity of commercial banks;Green credit is positively correlated with the financial performance of commercial banks.

In summary, when the research objects are provinces, cities and enterprises, scholars mostly use the interest proportion of six high-energy-consuming industries or policy dummy variables to measure green credit. When the research object is commercial banks, scholars generally use the balance of green loans and the amount of loans for energy conservation and environmental protection announced in the interbank social responsibility report to measure green credit. Scholars at home and abroad have conducted a lot of analysis and research on the relationship between green credit and environmental protection.

These studies can be divided into micro and macro perspectives. At the micro level, most of these studies focus on the relationship between green credit and corporate investment and financing, technological innovation, and pollution controlAt the macro level, most of these studies focus on the relationship between green credit and the level of environmental pollution and industrial structure at the national and provincial levels. From the perspective of financing constraints, scholars have mostly focused on high-polluting enterprises.

Scholars have shown that green credit has significantly reduced credit financing for heavily polluting firms. In addition, in order to make up for the long-term funding gap, high-polluting enterprises may also be forced by green credit policies to increase the scale of financial leasing, commercial credit and equity financing. This means that the green credit policy may cause some heavily polluting companies to scale back production and reduce pollution emissions in the face of a shortage of funds and rising costs.

However, these high-polluting enterprises may also be unable to carry out technological innovation due to policy restrictions, avoid banking financial institutions, and seek other financing channels, and the effectiveness of green credit policies will be questioned. From the perspective of technological innovation, there is a debate on whether green credit promotes the technological innovation of heavily polluting firms, and scholars believe that green credit inhibits the technological innovation of heavily polluting firms.

Scholars believe that green credit promotes technological innovation in heavily polluting firms. Some scholars have also conducted research on environmental protection enterprisesThe study believes that the larger the interest rate discount and the higher the financing ratio of green credit, the more it can incentivize the ** chain to adopt a higher level of low-carbon technology.

Some scholars have conducted comparative analysis of heavily polluting enterprises and environmental protection enterprises, and found that technological innovation strengthens the incentive effect of green credit on encouraged enterprises and alleviates the inhibition effect of green credit on eliminated enterprises. In addition, some scholars have focused on the performance gap of heavily polluting firms, and found that the inhibitory effect of green credit on green technology innovation only exists in heavily polluting firms with underperforming firms.

When a company has a performance surplus, green credit is directly proportional to green technology innovation. From the perspective of sewage treatment, scholars have relatively little research on sewage discharge and treatment. Research has shown that the size of green credit is positively correlated with corporate efforts to reduce emissions. Research proves that green credit can significantly promote corporate environmental disclosure. The study finds that the green credit policy accelerates the transformation of corporate environmental governance from end-of-line governance to other governance methods.

The study found that green credit policies can motivate polluting companies to invest in the environment, and that they will change their polluting behaviour for long-term development. Dividing enterprises into low-polluting enterprises and high-polluting enterprises, the study found that green credit can reduce the emission behavior of high-polluting enterprises, and the emission reduction effect of green credit instruments is more obvious in areas with low pollution levels and less pressure on regional development.

From the perspective of green technology progress, scholars focus on the impact of green credit on carbon-emitting technologies, and these studies can be divided into two categories: linear and non-linear studies. ** Scholars in the study, and there is a consensus that green credit is beneficial for reducing carbon emissionsResearch confirms that green credit is primarily about achieving green economic growth through technological progressResearch confirms that green credit promotes green technology progress;

By adopting a spatial autoregressive model, it is found that green credit accelerates the progress of low-carbon technologiesThe study confirms that green credit has significantly promoted the improvement of regional green technology innovation. In the nonlinear study, the study confirms that there is a "U-shaped" relationship between green credit and green and low-carbon technologies, that is, green credit inhibits the progress of green and low-carbon technologies at first, but with the expansion of green credit, the inhibition effect turns into a promoting effect.

From the perspective of industrial structure optimization, the panel data model is constructed, and it is found that green credit is conducive to industrial structure optimizationIn the process of studying green credit and green economic growth, it is found that industrial structure is an intermediary variable, which strengthens the role of green credit in green economic growthThe results show that green credit mainly promotes the upgrading of industrial structure through financing constraints

The research went further, and he carefully classified the industries, and finally found that green credit has the greatest impact on the tertiary industryUsing the dynamic panel model from 2005 to 2016, it is found that green credit has a positive effect on the upgrading of industrial structure. From the perspective of pollution emissions, scholars focus on whether green credit curbs carbon emissions. It was found that the green finance business suppressed carbon emissions;The study finds that green credit inhibits carbon dioxide emissions mainly through two pathways: green technology innovation and optimization of industrial structure

Using the dynamic panel data model, the study found that both green credit and green venture capital can inhibit carbon emissionsThe study found that green credit improved carbon emission efficiency;The panel smoothing transformation model and the spatial Durbin model were used to confirm the negative correlation between green credit and carbon emissionsIt is further found that green credit can not only promote local CO2 emission reduction, but also promote CO2 emission reduction in surrounding areas through spatial spillover effect.

The study of the impact of green credit on air quality shows that the environmental effect of green credit has not been proven in the early stage of development, but with the continuous improvement of the green credit system, its positive effect on air quality has begun to appear. At the national level, green credit can effectively alleviate environmental pollution. Green credit policies can increase the difficulty of lending to polluting and extensive enterprises through the credit level.

It has forced its production capacity to transform to energy conservation and environmental protection, pollution control, and efficient use of energy. At the same time, more funds under the guidance of green credit will flow to green industries, accelerating the shift of industrial gravity, thereby improving environmental pollution. From the regional level, the impact of green credit on environmental pollution level is heterogeneous, and the inhibition effect of green credit on environmental pollution is the most obvious and significant in the eastern region, followed by the central region and the western region

Compared with low-pollution areas, green credit in high-pollution areas has a better effect on improving environmental pollution. Taking per capita GDP as the threshold variable, it is found that per capita GDP is positively correlated with environmental pollution, which indicates that in order to improve the quality of environmental pollution, more attention needs to be paid to the quality of economic development, rather than the total amount of economic development, and the continuous growth of per capita GDP can improve the environmental pollution.

Green credit increases the difficulty of lending to polluting and extensive enterprises through the credit levelIn order to obtain more loans, these companies are forced to transition from non-clean energy to clean energy, so as to improve environmental pollution. At the same time, through the implementation of differentiated credit policies, green credit is conducive to the development of environmental protection enterprises and attracts the establishment of new environmental protection enterprises.

On the other hand, it forces high-energy-consuming and high-polluting enterprises to eliminate backward technologies and adopt or even start to develop clean technologies, thus indirectly realizing environmental pollution control. To sum up, the implementation of the green credit policy has indeed reduced the level of environmental pollution in various regions, which is conducive to the sustainable development of China's economy. However, there is still room for improvement in the current green credit policy, and the following suggestions are put forward to further improve the current situation of environmental pollution in China.

To establish a sound green credit system, the focus is on establishing an information sharing platform and unified data standards. Although China has published a number of policy documents on green credit, banking financial institutions have also established their own credit databasesScholars have also conducted a lot of research, but on the integration and integration of green credit.

First, there is still a lot of room for improvement in standardization.

Through literature review, it is found that there are still no authoritative indicators that can measure green credit variables in China, and there is a lack of provincial statistical data on green credit balances and energy conservation and environmental protection loans, while the bank loan data statistics in pollution investment** have not been updated as of 2010. In most cases, these data cannot support long-span and provincial-level studies. The following indicator - interest expense of non-six high-energy-consuming industries.

Although this indicator has strong data availability and a wide time span, it still has many shortcomings, such as a weak correlation with green credit. In the future, the relevant departments must cooperate with the banking financial institutions of all provinces and cities across the country to establish a scientific, strongly correlated, stable and sustainable green credit index on the basis of the previous green credit balance.

In addition, this indicator should not only stay at the dimension of major commercial banks, but should be extended to the dimension of provinces, cities and the whole country. While doing a good job in the unification of green credit data, it is also necessary to establish a relevant information sharing mechanism, make full use of the "Internet + finance" model, and all provinces and cities should cooperate with banking financial institutions to unify and integrate data and policies related to green credit.

On this platform, the public, institutions and enterprises can inquire about green credit information at any time, so as to realize the standardization, data, visualization and traceability of this indicator. At the same time, the establishment of this data platform is not only conducive to the development of green credit business, but also can be used as a model for other green finance businesses such as green bonds and green investment, and can even establish a platform that includes all information on green finance, which will be a major boost for China's sustainable development.

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