China Journal of Accounting Research · 2024 · 29 citations · 64 references
BusinessBusiness EconomicsEconomicsCorporate FinanceCost Of CapitalSustainability AccountingCorporate Sustainability DisclosureCost Of DebtDebt ManagementDebt ModelingEsg DisclosureEsg ReportingEsg MaterialityEsg Performance MetricsEsg Strategy
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.
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Credit Rationing in Markets with Imperfect Information
Joseph E. Stiglitz, Andrew Weiss · American Economic Review · 1981 · 12.9K citations · Full text
Illiquidity and stock returns: cross-section and time-series effects
Yakov Amihud · Journal of Financial Markets · 2002 · 10.3K citations · Full text
Liquidity Risk and Expected Stock Returns
Ľuboš Pástor, Robert F. Stambaugh · Journal of Political Economy · 2003 · 5.6K citations
Business, Finance, Asset Pricing +16