ESG Rating Divergence, Corporate Financing Costs, and Investment Decisions: A Financial Case Study of a Chinese Renewable Energy Leader

DOI

10.2991/978-94-6239-777-4_55How to use a DOI?

Keywords

ESG Rating Divergence; Financing Cost; Renewable Energy; Investment Decision; CATL

Abstract

Environmental, Social, and Governance (ESG) metrics have become one of the key determinants for a firm’s financing terms and risk assessment in the international capital market. However, the disparity increases between ESG evaluators, there will be doubt over companies’ environmental as well as societal shortcomings and their financial prospects, mainly in developing areas that keep it mostly optional. This article is based on the financial analysis of Contemporary Amperex Technology Co., Limited (CATL) as a representative company to study how the discrepancy in ESG rating affects their corporate funding expenses and capital allocation decisions. Looking at this data, this study can see that strong ESG results bring greener funding and better firm administration. But if the ESOs are inconsistent, it makes equity capital 8 -12% costlier and also reduces fund shortage because of information lopsidedness. This shifts where money goes and causes opposite desires. Those can constrain a rise in manufacturing capacity by 15-20pp and cut the innovation productivity of capital-intensive green energy. This study tries to ease the negatives by all the companies’ reports with a similar ESG way of reporting following the SASB Framework, and use ESG scenario modeling alongside capital modeling, diversify fund source with Green debentures and Sustainability-linked loans. It adds to knowledge of how sustainable finance works in developing nations and points out that ESG ratings have to match if there is to be any efficient allocation of capital when the world goes clean.

Copyright

© 2026 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.

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TY  - CONF
AU  - Fangjia Liu
PY  - 2026
DA  - 2026/09/30
TI  - ESG Rating Divergence, Corporate Financing Costs, and Investment Decisions: A Financial Case Study of a Chinese Renewable Energy Leader
BT  - Proceedings of the 2026 8th International Conference on Economic Management and Cultural Industry (ICEMCI 2026)
PB  - Atlantis Press
SP  - 513
EP  - 529
SN  - 2352-5428
UR  - https://doi.org/10.2991/978-94-6239-777-4_55
DO  - 10.2991/978-94-6239-777-4_55
ID  - Liu2026
ER  -