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Impact of regional green finance development on green transformation of enterprises

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  • Huang, Shuai
  • Wang, Yiqing
  • Li, Siqi
  • Pan, Dongliang

Abstract

In the context of pursuing sustainable development, promoting green transformation of enterprises has become a core issue. Taking Chinese A-share listed companies from (2010–2023), this study constructs a composite index of regional green financial development covering seven dimensions, including green credit, investment, insurance, and others. It adopts the green innovation quality and green total factor productivity of enterprises as the measure of corporate green transformation and constructs a two-way fixed effect model to conduct empirical tests. It is found that regional green financial development can significantly promote the green transformation of enterprises, and this conclusion holds after a series of robustness tests. Mechanism testing reveals that green finance (GF) primarily promotes corporate green transformation by enhancing innovation capabilities and alleviating financing constraints. Heterogeneity analysis indicates that regional GF exerts a more pronounced effect on the green transformation of heavily polluting enterprises and non-state-owned enterprises. This study not only provides solid evidence for understanding the policy effects of GF but also provides important policy insights for regions to guide the green upgrading of industries.

Suggested Citation

  • Huang, Shuai & Wang, Yiqing & Li, Siqi & Pan, Dongliang, 2026. "Impact of regional green finance development on green transformation of enterprises," Finance Research Letters, Elsevier, vol. 92(C).
    • Handle: RePEc:eee:finlet:v:92:y:2026:i:c:s1544612325026613
    DOI: 10.1016/j.frl.2025.109412
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