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How ESG performance affects maturity mismatches between investment and financing: Evidence from Chinese A-share listed companies

Author

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  • Wen, Huwei
  • Liu, Yupeng
  • Lee, Chien-Chiang

Abstract

This study investigates the relationship between environment, society, and governance (ESG) performance and maturity mismatches between investment and financing based on unbalanced panel data from Chinese listed companies. The results suggest that ESG performance significantly reduces the potential for maturity mismatch between corporate investment and financing and that the ESG activities of Chinese enterprises are consistent with the principles of responsible investment. Specifically, society and governance performance significantly reduces maturity mismatch, while environmental performance exerts an insignificant effect. Enterprises with high ESG performance prefer long-term debt financing structures, and they also have increased trade credit and endogenous financing. In addition, investment efficiency and innovative investment are beneficial for ESG performance to promote the long-term transformation of debt maturity structures. Finally, ESG performance is more effective in reducing maturity mismatch caused by environmental policy and COVID-19.

Suggested Citation

  • Wen, Huwei & Liu, Yupeng & Lee, Chien-Chiang, 2024. "How ESG performance affects maturity mismatches between investment and financing: Evidence from Chinese A-share listed companies," Research in International Business and Finance, Elsevier, vol. 71(C).
    • Handle: RePEc:eee:riibaf:v:71:y:2024:i:c:s0275531924002058
    DOI: 10.1016/j.ribaf.2024.102412
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