Do shareholders benefit from green bonds?

Abstract

journal of corporate finance 61 (2020) 101427 contents lists available at sciencedirect journal of corporate finance journal homepage: www.elsevier.com/locate/jcorpfin do shareholders benefit from green bonds? ☆ ⁎ dragon yongjun tang, yupu zhang faculty of business and economics, the university of hong kong, hong kong a r t i c l e i n f o a b s t r a c t t 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. 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. overall, our findings suggest that the firm's issuance of green bonds is beneficial to its existing shareholders. keywords: green bonds corporate social responsibility environmental social and governance (esg) institutional ownership stock liquidity investor attention jel classifications: g14 g32 g38 m14 1. introduction environmental, social, and …

Source: pdf_first_chars