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Does it pay to go green? The impact of green bond issuance on corporate performance

Author

Listed:
  • Han Yu

    (CERAG - Centre d'études et de recherches appliquées à la gestion - UGA - Université Grenoble Alpes)

  • Radu Burlacu

    (CERAG - Centre d'études et de recherches appliquées à la gestion - UGA - Université Grenoble Alpes)

  • Geoffroy Enjolras

    (CERAG - Centre d'études et de recherches appliquées à la gestion - UGA - Université Grenoble Alpes, UGA INP IAE - Grenoble Institut d'Administration des Entreprises - UGA - Université Grenoble Alpes - Grenoble INP - Institut polytechnique de Grenoble - Grenoble Institute of Technology - UGA - Université Grenoble Alpes)

Abstract

Using a sample of 145 first-time green bond issuers and 2,225 non-issuers in 10 countries/regions from 2014 to 2019, we conduct a Propensity Score Matching combined with a Difference-in-Difference analysis to examine the impact of green bond issuance on firms' long-term environmental and financial performance. By comparing changes after green bond issuance between issuers and a paired control group, we find a significant improvement in financial performance two years after issuance but no significant changes in environmental performance. These effects vary among issuers in different sectors and countries. Notably, only issuers in the industrial and energy sectors experience real benefits from green bond issuance. Furthermore, the improvement in corporate performance appears with a lag of approximately two years.

Suggested Citation

  • Han Yu & Radu Burlacu & Geoffroy Enjolras, 2025. "Does it pay to go green? The impact of green bond issuance on corporate performance," Post-Print hal-05542598, HAL.
    • Handle: RePEc:hal:journl:hal-05542598
    DOI: 10.54695/bmi.182.0053
    as

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    JEL classification:

    • G24 - Financial Economics - - Financial Institutions and Services - - - Investment Banking; Venture Capital; Brokerage
    • O16 - Economic Development, Innovation, Technological Change, and Growth - - Economic Development - - - Financial Markets; Saving and Capital Investment; Corporate Finance and Governance
    • Q50 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - General

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