Greening the Chinese financial system through experimentations? Assessing the effectiveness of green finance business experimentations in Guangdong, China

The necessity of greening the financial system for sustainability transition has been widely acknowledged and advocated. Experimentation is recognised as an important approach to transforming the financial system and includes promoting innovative practices, building capacity and forming networks. In the real-world settings, the designing and the implementation of experimentations are diverse processes. This study argues that lacking critical reflection and evaluation of the nature of experimentations can jeopardise its role as an agent for transformative changes. By mobilising insights from financial innovation literature and using data drawn from interviews and from financial institutions’ self-reported green finance innovation practices, this study shows that experimentations can be manipulated to validate business-as-usual actions rather than being used as an approach to pursuing more radical innovations. Moreover, we also found that some financial institutions have participated in green finance experimentation in a passive manner, which represents a missed opportunity to build capacities and accumulate knowledge through the experimental process. This study addresses research demands for a more critical empirical re-assessment of the positive narratives regarding inducing transformative changes through experimentations.