How Does ESG Performance Impact Corporate Financing Costs?An Empirical Study in China

In the background of the green transformation of the economy and society,the ESG performance of enterprises has been paid more and more attention in the investment decision-making.However,previous studies have inadequately explored how the ESG performance affects corporate financing costs.Based on the information asymmetry theory,this paper analyzes the impact mechanism of ESG performance on corporate financing costs.Then,taking 1044 A-share listed companies in2016–2020 as a sample,through the sorting and analysis of ESG report disclosure and rating data,the company’s ESG performance indicators are obtained,and an empirical model is built to test the relationship between ESG performance and corporate financing costs.This paper constructs a panel regression model using ESG rating data and corporate financial data and finds that in the overall sample,the higher the ESG performance,the lower the equity financing cost;The higher the ESG performance,the lower the debt financing cost.In addition,it also discussed the moderating effect of enterprise scale and media attention on the impact of ESG performance on enterprise financing costs.The empirical results show that the influence of company size on ESG performance on financing costs has a moderating effect and a positive moderating effect.

The spillover effect of customers’ESG performance on suppliers’green innovation quality

This study investigates whether and how customer firms’environmental,social and governance(ESG)performance impacts suppliers’green innovation quality using a sample of Chinese A-share listed companies from 2009 to 2022.We find that customers’ESG performance facilitates suppliers’green innovation quality through green learning and corporate competition.Additional tests indicate that customers with stickier customer-supplier relationships and a more central position in the supply chain network than peers enhance suppliers’green innovation quality.After categorizing whether customers engage in greenwashing,we determine that those adherence to green principles,genuinely promote suppliers’green innovation quality.Finally,we find the above effect ultimately enhances suppliers’environmental performance.This study provides valuable insights for supply chain companies into collaboratively achieving sustainable development.

ESG performance and cost of debt

We analyze China Securities Index Co.,Ltd.(CSI)environmental,social and governance(ESG)scoring data,which incorporate Chinese characteristics,to assess the impact of ESG performance on corporate debt financing costs.Our findings indicate that better CSI ESG scores are correlated with lower debt financing costs.Additionally,improvements in local environmental execution enhance the effect of CSI ESG scores on debt financing costs.However,this effect diminishes with increased internal control quality and marketization.Governance has the greatest impact on reducing debt financing costs,followed by social and environmental factors.Superior CSI ESG scores reduce corporate debt financing costs by enhancing debt repayment capacity and reducing information asymmetry.Economic consequence analysis confirms that lower financing costs,driven by improved ESG performance,significantly enhance total factor productivity and firm value.CSI ESG scores also significantly impact bank loans but not corporate bond financing.

The impact of big data tax administration on corporate ESG—A quasi-natural experiment based on Golden Tax Project Ⅲ

Environmental,social and governance(ESG)practices are pivotal to global sustainability yet face challenges.Based on the implementation of Golden Tax Project Ⅲ,we find that big data tax administration decreases corporate ESG performance.Mechanism tests indicate that Golden Tax Project Ⅲ can reduce tax avoidance,cash flow and green innovation,thereby inhibiting ESG through the“taxation effect.”Conversely,the project can reduce agency costs and improve information transparency,thus promoting ESG performance through the“governance effect.”Overall,however,the project inhibits corporate ESG performance.According to further analysis,the negative effect on ESG performance mainly impacts the environmental responsibility(E)element.This paper provides insights relevant to advancing China’s“dual carbon”policy and formulating a“Chinese approach”to global sustainable development.