Green Investment by Firms : Finance or Climate Driven ?
There is limited research on the determinants of firms’ green investment strategies in developing regions despite their importance to meet global climate change targets. Understanding how changes in firm climate investment affect environmental perf...
| Main Authors: | , , |
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| Language: | English |
| Published: |
World Bank, Washington, DC
2022
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| Subjects: | |
| Online Access: | http://documents.worldbank.org/curated/en/099725305102236711/IDU02bf347ba086050401008674010ed29aa4f84 http://hdl.handle.net/10986/37516 |
| Summary: | There is limited research on the
determinants of firms’ green investment strategies in
developing regions despite their importance to meet global
climate change targets. Understanding how changes in firm
climate investment affect environmental performance is
essential for policy makers and firms alike. Based on unique
data from the joint European Bank for Reconstruction and
Development–European Investment Bank–World Bank Group
Enterprise Surveys, this paper empirically examines the role
of access to finance and green management practices in
firms’ green investment strategies. Based on logistic
regressions, the econometric analysis finds a positive
influence of green management practices on the number of
mitigation measures implemented. By contrast, firms that are
financially constrained are less likely to pursue many
mitigation measures. Finally, the results do not show
significant differences in the impact of financial
constraints on the type of green investment, but indicate
that better green management practices lead to a higher
likelihood of investing in both capital- and
non-capital-intensive green measures. |
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