The impact of the level of green finance development on corporate debt financing capacity

Abstract

In recent years, sustainable development has become a critical topic, receiving strong attention from both researchers and businesses. Green finance, in particular, has been widely discussed globally, and Vietnam is no exception. In 2021, the Prime Minister approved the “National Strategy for Green Growth for the period 2021-2030, with a vision to 2050,” aiming at a green economy and sustainable development. Using data from companies listed on the HOSE and HNX stock exchanges in Vietnam from 2018 to 2022, this study analyzes the impact of green finance development on the debt financing capacity of listed enterprises in Vietnam. The authors employed the Entropy weighting method to calculate the level of green finance development (GF) from 2018 to 2022 and the Fixed Effects Generalized Least Squares (FGLS) method to examine how the level of green finance development affects the scale and cost of debt financing for enterprises. The research findings indicate that higher levels of green finance development enhance the debt financing capacity of enterprises while reducing the cost of debt financing