Key points are not available for this paper at this time.
Green bonds not only serve as a financial instrument for corporations, but also as a critical mechanism to advance corporate environmental governance. Using a sample of Chinese A-share listed companies from 2012 to 2020, we use a multiple-period Difference-in-Differences methodology to investigate the impact of green bond issuance on environmental decoupling. Our analysis yields several key findings. First, green bond issuance significantly promotes environmental decoupling, the conclusion remains robust across various sensitivity tests. Second, green bond issuance facilitates environmental decoupling by attracting green-oriented managers and expanding firms’ rent-seeking opportunities. Third, in contrast to ‘brownwashing’, green bond issuance predominantly encourages ‘greenwashing’ behaviours. Fourth, compared to firms with stronger bargaining power, green bond issuance has a more pronounced impact on environmental decoupling in firms with weaker bargaining power. Fifth, principal–agent problems exacerbate environmental decoupling behaviour. This study provides compelling evidence on how green bonds influence corporate environmental decoupling, thereby contributing to a deeper understanding of green finance in the academic literature.
Wang et al. (Wed,) studied this question.