Findings from University of Hong Kong Update Knowledge of Corporate Finance (Do shareholders benefit from green bonds?)

2020 MAY 14 (NewsRx) — By a News Reporter-Staff News Editor at Daily Hong Kong Report — Investigators publish new report on Finance – Corporate Finance. According to news reporting originating from Hong Kong, People’s Republic of China, by NewsRx correspondents, research stated, “The green bond market has been growing rapidly worldwide since its debut in 2007. We present the first empirical study on the announcement returns and real effects of green bond issuance by firms in 28 countries during 2007-2017.”

Our news editors obtained a quote from the research from the University of Hong Kong, “After compiling a comprehensive international green bond dataset, we document that stock prices positively respond to green bond issuance. However, we do not find a consistently significant premium for green bonds, suggesting that the positive stock returns around green bond announcements are not fully driven by the lower cost of debt. Nevertheless, we show that institutional ownership, especially from domestic institutions, increases after the firm issues green bonds. Moreover, stock liquidity significantly improves upon the issuance of green bonds.”

According to the news editors, the research concluded: “Overall, our findings suggest that the firm’s issuance of green bonds is beneficial to its existing shareholders.”

For more information on this research see: Do shareholders benefit from green bonds? Journal of Corporate Finance, 2020;61():101427. Journal of Corporate Finance can be contacted at: Elsevier, Radarweg 29, 1043 Nx Amsterdam, Netherlands. (Elsevier – www.elsevier.com; Journal of Corporate Finance – http://www.journals.elsevier.com/journal-of-corporate-finance/)

The news editors report that additional information may be obtained by contacting Y.P. Zhang, University of Hong Kong, Faculty of Business and Economics, Hong Kong, People’s Republic of China.

The direct object identifier (DOI) for that additional information is: https://doi.org/10.1016/j.jcorpfin.2018.12.001. This DOI is a link to an online electronic document that is either free or for purchase, and can be your direct source for a journal article and its citation.

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