Advances in Economics, Management and Political Sciences
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Proceedings of the 3rd International Conference on Business and Policy Studies
Series Vol. 66 , 05 January 2024
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Intermediary Mechanism Study on the Impact of ESG Assessment on Bond Issuance Interest Rates
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Abstract
ESG (Environmental, Social, and Governance) assessment is a widely recognized system for evaluating corporate sustainable development by international investors. The emphasis and improvement of ESG indices can have multiple effects on corporate operations and development. This paper focuses on the impact of ESG on corporate bond financing interest rates, considering the relevant relationships and intermediary mechanisms involved. The results indicate that, with controlled variables considered, corporate bonds with higher ESG scores tend to have lower issuance interest rates. Furthermore, besides the direct impact on bond rates, ESG scores also generate indirect effects through the intermediary variable of “financing constraints.” The study establishes from a corporate financing perspective that the development of ESG assessment has positive implications for corporate operations and confirms the intermediary role of financing constraints in this causal chain. According to the results, targeted recommendations are proposed for corporate operations: to reduce financing costs, continually optimize ESG and financing constraints.
Keywords
ESG, bond issuance interest rates, intermediary mechanism
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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)
- 978-1-83558-263-3
- ISBN (Online)
- 978-1-83558-264-0
- Published Date
- 05 January 2024
- Series
- Advances in Economics, Management and Political Sciences
- ISSN (Print)
- 2754-1169
- ISSN (Online)
- 2754-1177
- DOI
- 10.54254/2754-1169/66/20241206
- 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