Impact of ESG Rating on Corporate Finance Costs

DOI

10.2991/978-94-6463-874-5_48How to use a DOI?

Keywords

Green Economy; ESG performance; Enterprise Financing; Weighted Average Cost of Capital(WACC)

Abstract

With the global focus on sustainable development, green finance has become a topic of great interest in recent years, which is also affecting the cost and decision-making of every enterprise. However, China, as an emerging country practicing green finance policies, has significant gaps in the research on this part of corporate finance costs. Therefore, this paper will explore the factors affecting corporate financing costs in the context of green economy. This paper will screen out the independent variables that significantly affect the enterprise financing cost, and use SPSS to conduct multiple linear regression analysis on them, and according to the empirical analysis, it is concluded that the enterprise financing cost with high P/E ratio may be due to the enterprise’s high market expectation accompanied by high risk. Corporate Gearing ratio has a negative impact on corporate financing cost due to the tax shield effect. Based on this conclusion, it is suggested that the government should carry out green innovation and promote the transformation of enterprises to environmentally friendly enterprises.

Copyright

© 2025 The Author(s)

Open Access

Open Access This chapter is licensed under the terms of the Creative Commons Attribution-NonCommercial 4.0 International License (http://creativecommons.org/licenses/by-nc/4.0/), which permits any noncommercial use, sharing, adaptation, distribution and reproduction in any medium or format, as long as you give appropriate credit to the original author(s) and the source, provide a link to the Creative Commons license and indicate if changes were made.

Download article (PDF)

TY  - CONF
AU  - Yuxi Li
PY  - 2025
DA  - 2025/11/03
TI  - Impact of ESG Rating on Corporate Finance Costs
BT  - Proceedings of the 2025 International Conference on Financial Innovation and Marketing Management (FIMM 2025)
PB  - Atlantis Press
SP  - 401
EP  - 411
SN  - 2352-5428
UR  - https://doi.org/10.2991/978-94-6463-874-5_48
DO  - 10.2991/978-94-6463-874-5_48
ID  - Li2025
ER  -