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Green Credit Policy and Maturity Mismatch Risk in Polluting and Non-Polluting Companies

Author

Listed:
  • Yaowei Cao

    (School of Management, Wuhan University of Technology, Wuhan 430070, China)

  • Youtang Zhang

    (School of Management, Wuhan University of Technology, Wuhan 430070, China)

  • Liu Yang

    (School of Management, Wuhan University of Technology, Wuhan 430070, China)

  • Rita Yi Man Li

    (School of Economics and Finance/Sustainable Real Estate Research Center, Hong Kong Shue Yan University, Hong Kong 5132, China)

  • M. James C. Crabbe

    (Wolfson College, Oxford University, Oxford OX1 2JD, UK
    School of Life Sciences, Shanxi University, Taiyuan 030006, China
    Institute of Biomedical and Environmental Science & Technology, University of Bedfordshire, Park Square, Luton LU1 3JU, UK)

Abstract

A major issue is whether the implementation of China’s green credit policy will affect the coordinated development of corporate sustainable operations and environmental protection. This paper used a propensity score matching—difference-in-differences (PSM-DID) model to analyse the impact of China’s green credit policy implemented in 2012 on the maturity mismatch risk between investment and financing in polluting and non-polluting companies. We found that: (1) green credit policies can help reduce the risk of maturity mismatch between investment and financing for polluting companies; (2) the reduction of short-term bank credit is the main way to curb the risk of maturity mismatch risk between investment and financing; (3) the green credit policy has no obvious mitigation effect on the risk of maturity mismatch between investment and financing among polluting companies with environmental protection investment; (4) the mitigation effect of the green credit policy on the maturity mismatch risk is more significant in state-owned polluting companies and polluting companies in areas with a lower level of financial development. The empirical results show that China’s green credit policy helps stimulate the environmental protection behaviour of companies, as well as helping alleviate the capital chain risk caused by the maturity mismatch between investment and financing. In addition, despite the effect of heterogeneity, it can solve the contradiction between environmental protection and economic development.

Suggested Citation

  • Yaowei Cao & Youtang Zhang & Liu Yang & Rita Yi Man Li & M. James C. Crabbe, 2021. "Green Credit Policy and Maturity Mismatch Risk in Polluting and Non-Polluting Companies," Sustainability, MDPI, vol. 13(7), pages 1-23, March.
    • Handle: RePEc:gam:jsusta:v:13:y:2021:i:7:p:3615-:d:523357
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    Cited by:

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    2. Yanli Wang & Xiaodong Lei & Dongxiao Zhao & Ruyin Long & Meifen Wu, 2021. "The Dual Impacts of Green Credit on Economy and Environment: Evidence from China," Sustainability, MDPI, vol. 13(8), pages 1-13, April.
    3. Li, Lifang & Qiu, Lexin & Xu, Fangming & Zheng, Xinwei, 2023. "The impact of green credit on firms' green investment efficiency: Evidence from China," Pacific-Basin Finance Journal, Elsevier, vol. 79(C).
    4. Tianchu Feng & Meijuan Liu & Chaozhu Li, 2022. "How Does Vertical Fiscal Imbalance Affect CO 2 Emissions? The Role of Capital Mismatch," Sustainability, MDPI, vol. 14(17), pages 1-15, August.
    5. Yanhong Liu & Jia Lei & Yihua Zhang, 2021. "A Study on the Sustainable Relationship among the Green Finance, Environment Regulation and Green-Total-Factor Productivity in China," Sustainability, MDPI, vol. 13(21), pages 1-27, October.

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