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Does corporate green innovation behaviour impact trade credit? Evidence from China

Author

Listed:
  • Li, Chen
  • Sensoy, Ahmet
  • Song, Ce
  • Zhang, Mi

Abstract

We explore whether and how corporate green innovation influences enterprises’ access to trade credit. Using Chinese corporations listed on the Shanghai and Shenzhen Stock Exchanges between 2014 and 2019 as the sample, we provide evidence that corporate green innovation can significantly enhance enterprises’ trade credit accessibility. This finding remains robust after undertaking various robustness checks. Channel analysis shows that upstream suppliers’ competition intensified by downstream buyers’ green innovation behaviours serves as a crucial linkage between corporate green innovation and trade credit. Heterogeneity analyses indicate that the augmenting impact of green innovation on trade credit accessibility is more pronounced in non-state-owned enterprises, large-size firms, and enterprises with high analyst coverage. Our findings contribute to the literature concerning both corporate green innovation and trade credit, and support enterprises and policymakers to promote green innovation, improve financing conditions, and drive sustainable development.

Suggested Citation

  • Li, Chen & Sensoy, Ahmet & Song, Ce & Zhang, Mi, 2023. "Does corporate green innovation behaviour impact trade credit? Evidence from China," Research in International Business and Finance, Elsevier, vol. 66(C).
    • Handle: RePEc:eee:riibaf:v:66:y:2023:i:c:s0275531923001824
    DOI: 10.1016/j.ribaf.2023.102056
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    More about this item

    Keywords

    Corporate green innovation; Trade credit; Bargaining power; Stakeholder theory;
    All these keywords.

    JEL classification:

    • G23 - Financial Economics - - Financial Institutions and Services - - - Non-bank Financial Institutions; Financial Instruments; Institutional Investors
    • G30 - Financial Economics - - Corporate Finance and Governance - - - General
    • G34 - Financial Economics - - Corporate Finance and Governance - - - Mergers; Acquisitions; Restructuring; Corporate Governance

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