Determinants of green bond issuance: agency or stakeholder motives matter?

Abstract

We investigate the underlying reasons for a firm to issue green bonds using agency and stakeholder theory as frameworks. We testhow different proxies for each theory explain the decision to issue a green bond. We also test whether these proxies are relevant togreen bond issuance amounts. We perform logit and fixed effects regressions using a dataset of green bond issuers and non-issuersin 27 countries for the 2013 to 2017 period. Our findings suggest that the agency motive is a key determinant of the decision to issuea green bond. However, agency issues seem to have only a partial impact on the size of the green bond issuances.