Does Green Bonds Placement Create Value For Firms?

24 Pages Posted: 1 Nov 2019

See all articles by Ilia Kuchin

Ilia Kuchin

Institute for Statistical Studies and Economics of Knowledge National Research University Higher School of Economics

Gennadiy Baranovsky

National Research University Higher School of Economics

Yury Dranev

National Research University Higher School of Economics

Alexander Chulok

National Research University Higher School of Economics - Institute for Statistical Studies and Economics of Knowledge

Date Written: October 30, 2019

Abstract

The goal of this research is to add to the existing corpus of knowledge concerning particular green finance instrument - green bonds. It tries to answer some questions relevant for both scholars and business in order to reinforce the development of green bonds market. One of these questions is whether green bonds issuance cause positive market reaction. Resent activities in global agenda, starting from United Nations Sustainable Goals released in 2015 and endings huge public attention for green issues in 2019 impose additional burden on companies’ competitiveness. Our major hypothesis is that ecological factors affect investors’ decisions whose portfolios and investment declarations are getting to be more aligned with global ecological agenda. The green bonds issuance provide a signal for investors that the issuing firm is involved in sustainable development and hence its stock may be included in the portfolio. The study discovers the significance of the “green” label for the stock market reaction. Alongside, it studies some other features of green bonds, fostering their evolvement and justifying their costs for issuers.

Keywords: green bonds; stock returns; event study; bonds issuance

JEL Classification: Q01, G10, G12, G14

Suggested Citation

Kuchin, Ilia and Baranovsky, Gennadiy and Dranev, Yury and Chulok, Alexander, Does Green Bonds Placement Create Value For Firms? (October 30, 2019). Higher School of Economics Research Paper No. WP BRP 101/STI/2019. Available at SSRN: https://ssrn.com/abstract=3477918

Ilia Kuchin (Contact Author)

Institute for Statistical Studies and Economics of Knowledge National Research University Higher School of Economics ( email )

Myasnitskaya st. 11
Moscow, 101000
Russia

Gennadiy Baranovsky

National Research University Higher School of Economics ( email )

Myasnitskaya street, 20
Moscow, Moscow 119017
Russia

Yury Dranev

National Research University Higher School of Economics ( email )

Myasnitskaya street, 20
Moscow, Moscow 119017
Russia

Alexander Chulok

National Research University Higher School of Economics - Institute for Statistical Studies and Economics of Knowledge ( email )

Myasnitskaya st. 18
Moscow, 101000
Russia

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