Advances in Economics, Management and Political Sciences

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Proceedings of the 3rd International Conference on Business and Policy Studies

Series Vol. 67 , 05 January 2024


Open Access | Article

Does ESG Affect Bank Lending to Companies?

Sinan Zhang * 1
1 University of York

* Author to whom correspondence should be addressed.

Advances in Economics, Management and Political Sciences, Vol. 67, 62-70
Published 05 January 2024. © 05 January 2024 The Author(s). Published by EWA Publishing
This article is an open access article distributed under the terms and conditions of the Creative Commons Attribution (CC BY) license, which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.
Citation Sinan Zhang. Does ESG Affect Bank Lending to Companies?. AEMPS (2024) Vol. 67: 62-70. DOI: 10.54254/2754-1169/67/20241264.

Abstract

with the serious intensification of global warming in recent years, countries around the world are actively developing carbon neutrality, carbon peaking, and reducing carbon emissions to ensure a healthier operation of the earth. To cooperate with the low-carbon policies of various countries, companies have also begun to implement policies to reduce carbon emissions and save energy, so ESG has gradually become a hot topic. ESG indicators are also becoming increasingly important in the financial industry. This research is a review essay. The research direction is to explore whether ESG indicators will affect corporate credit in banks by studying the policies and various data on carbon emissions that have been released by countries and by reading published papers. Through research on government policies and current thesis research, it is shown that there are currently no clear policies or rules stipulating how ESG indicators will affect corporate credit in banks, but the current banking industry will indeed pay more attention to ESG performance of companies when leading to companies, good ESG indicators will lead to better bank credit and lower cost of banking credit.

Keywords

Green finance, Green credit, ESG performance, Carbon peak, Carbon neutrality

References

1. Team, I. (2023, March 22). What Is Environmental, Social, and Governance (ESG) Investing? Investopedia.

2. Sustainable1 Solutions: ESG Scores | S&P Global. (n.d.).

3. Chodnicka-Jaworska, P. (2021, December 14). ESG as a Measure of Credit Ratings. Risks, 9(12), 226.

4. Huang, Y., Bai, F., Shang, M., & Ahmad, M. (2023, June 23). On the fast track: the benefits of ESG performance on the commercial credit financing. Environmental Science and Pollution Research, 30(35), 83961–83974.

5. Kim, S., Kum1ar, N., Lee, J., & Oh, J. (2021). ESG Lending. SSRN Electronic Journal.

6. Devalle, A., Fiandrino, S., & Cantino, V. (2017, August 15). The Linkage between ESG Performance and Credit Ratings: A Firm-Level Perspective Analysis. International Journal of Business and Management, 12(9), 53.

7. Cooper, E. W., & Uzur, H. (2015). Corporate social responsibility and the cost of debt. Journal of Accounting and Finance, 15(8), 11-30.

8. Menz, K.-M. (2010). Corporate social responsibility: Is it rewarded by the corporate bond market? A critical note. of Banking and Finance, 35(7), 1794-1810

9. Yao, W., Qian, M.(2023, Jan). Global Green Finance Development Report (2022)

10. Goss, A., & Roberts, G. S. (2011). The impact of corporate social responsibility on the cost of bank loans. Journal

11. China State Financial Supervision and Administration. (n.d.).

Data Availability

The datasets used and/or analyzed during the current study will be available from the authors upon reasonable request.

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Volume Title
Proceedings of the 3rd International Conference on Business and Policy Studies
ISBN (Print)
978-1-83558-265-7
ISBN (Online)
978-1-83558-266-4
Published Date
05 January 2024
Series
Advances in Economics, Management and Political Sciences
ISSN (Print)
2754-1169
ISSN (Online)
2754-1177
DOI
10.54254/2754-1169/67/20241264
Copyright
05 January 2024
Open Access
This article is an open access article distributed under the terms and conditions of the Creative Commons Attribution (CC BY) license, which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited

Copyright © 2023 EWA Publishing. Unless Otherwise Stated