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Green money talks: Does green bond issuance promote corporate green governance?

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  • Zhang, Hua
  • Guo, Zheng

Abstract

Despite extensive focus on the economic benefits of green bond issuance (GBI), existing research inadequately examines its micro-environmental impact on corporate green governance (CGG). This paper exploits a quasi-natural experiment of GBI in China and builds a staggered difference-in-differences model to explore whether and how GBI affects CGG. Using a dataset of 4,663 Chinese listed companies spanning 2009–2023, we find that GBI contributes to an improvement in CGG among treatment firms relative to control firms. This improvement is attributed to three potential pathways: reduced financial constraints, increased environmental attention, and enhanced green innovation. Moreover, the CGG effect is more pronounced for large, old, high-debt-pressure firms, as well as those situated in eastern, strong-environmental-constraint, and high levels of financial development cities. Our findings carry far-reaching implications for the role of green bonds in fostering substantial sustainability efforts in emerging economies.

Suggested Citation

  • Zhang, Hua & Guo, Zheng, 2026. "Green money talks: Does green bond issuance promote corporate green governance?," Research in International Business and Finance, Elsevier, vol. 82(C).
    • Handle: RePEc:eee:riibaf:v:82:y:2026:i:c:s0275531925005148
    DOI: 10.1016/j.ribaf.2025.103258
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