Pub Date : 2025-11-20DOI: 10.1016/j.ribaf.2025.103224
Chi Chen , Shreya Pal , Mantu Kumar Mahalik , Giray Gozgor
This study examines the impact of financial inclusion on sustainable development in the BICS (Brazil, India, China, and South Africa) economies, using balanced panel data from 2004 to 2023. This study also employs the System Generalised Method of Moments, Driscoll–Kraay standard errors, and Feasible Generalised Least Squares regression techniques for the empirical analysis. The findings indicate that financial inclusion is a significant driver of sustainable development. Gross fixed capital formation and urbanisation also make positive contributions, underscoring the importance of sustainable infrastructure and well-planned urban growth. By contrast, economic globalisation and ineffective government policies are found to hinder progress towards sustainability. Taken together, these results highlight the need for BICS countries to expand financial access, increase investment in fixed capital, and promote resilient urban development.
{"title":"The impact of financial inclusion on sustainable development: Evidence from BICS economies","authors":"Chi Chen , Shreya Pal , Mantu Kumar Mahalik , Giray Gozgor","doi":"10.1016/j.ribaf.2025.103224","DOIUrl":"10.1016/j.ribaf.2025.103224","url":null,"abstract":"<div><div>This study examines the impact of financial inclusion on sustainable development in the BICS (Brazil, India, China, and South Africa) economies, using balanced panel data from 2004 to 2023. This study also employs the System Generalised Method of Moments, Driscoll–Kraay standard errors, and Feasible Generalised Least Squares regression techniques for the empirical analysis. The findings indicate that financial inclusion is a significant driver of sustainable development. Gross fixed capital formation and urbanisation also make positive contributions, underscoring the importance of sustainable infrastructure and well-planned urban growth. By contrast, economic globalisation and ineffective government policies are found to hinder progress towards sustainability. Taken together, these results highlight the need for BICS countries to expand financial access, increase investment in fixed capital, and promote resilient urban development.</div></div>","PeriodicalId":51430,"journal":{"name":"Research in International Business and Finance","volume":"82 ","pages":"Article 103224"},"PeriodicalIF":6.9,"publicationDate":"2025-11-20","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"145584543","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-11-19DOI: 10.1016/j.ribaf.2025.103219
Huangyue Chen , Yang Zhao
This paper examines the relationship between earnings pressure and tax avoidance behavior among managers striving to meet earnings expectations, using the context of listed corporations’ subsidiaries. Using data on the subsidiaries of Chinese A-share listed companies, this study finds that subsidiaries engage in greater tax avoidance under earnings pressure, suggesting that managers may increase tax avoidance to maximize the retention of economic benefits within the company to meet capital market expectations. Further analysis reveals that this impact is reduced when subsidiaries are not major taxpayers, fall under the jurisdiction of the national tax bureau, are in regions with lower tax enforcement capacity, or are located in regions with high fiscal pressure. These findings indicate that listed companies engage in strategic tax avoidance through their subsidiaries. This study does not find evidence of book-tax conforming tax avoidance, suggesting that book-tax non-conforming tax avoidance is more likely employed. This research extends the literature on corporate strategic behavior under external pressures and provides important insights for academia, regulators, and policymakers.
{"title":"Earnings pressure and strategic tax avoidance: Micro evidence based on listed corporations’ subsidiaries","authors":"Huangyue Chen , Yang Zhao","doi":"10.1016/j.ribaf.2025.103219","DOIUrl":"10.1016/j.ribaf.2025.103219","url":null,"abstract":"<div><div>This paper examines the relationship between earnings pressure and tax avoidance behavior among managers striving to meet earnings expectations, using the context of listed corporations’ subsidiaries. Using data on the subsidiaries of Chinese A-share listed companies, this study finds that subsidiaries engage in greater tax avoidance under earnings pressure, suggesting that managers may increase tax avoidance to maximize the retention of economic benefits within the company to meet capital market expectations. Further analysis reveals that this impact is reduced when subsidiaries are not major taxpayers, fall under the jurisdiction of the national tax bureau, are in regions with lower tax enforcement capacity, or are located in regions with high fiscal pressure. These findings indicate that listed companies engage in strategic tax avoidance through their subsidiaries. This study does not find evidence of book-tax conforming tax avoidance, suggesting that book-tax non-conforming tax avoidance is more likely employed. This research extends the literature on corporate strategic behavior under external pressures and provides important insights for academia, regulators, and policymakers.</div></div>","PeriodicalId":51430,"journal":{"name":"Research in International Business and Finance","volume":"81 ","pages":"Article 103219"},"PeriodicalIF":6.9,"publicationDate":"2025-11-19","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"145571275","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-11-19DOI: 10.1016/j.ribaf.2025.103220
Xixiong Xu , Linchun Wu , Cuiliang Lin , Weiyu Gan
We examine the effect of clan culture on corporate earnings management and delineate its underlying mechanism from an institutional theory perspective. Our findings reveal that firms with stronger clan culture have a lower level of earnings management. The transmission mechanism tests demonstrate that clan culture can reduce the earnings management through enhancing ethical constraints, reinforcing resource sharing, and fostering long-term orientation. Furthermore, the negative influence of clan culture on earnings management is more significant in firms with worse audit quality, less foreign cultural experience, lower marketization level, and higher degree of openness. This study not only extends our understanding of the determinants of earnings management from the perspective of informal institutions but also enriches the research on the economic consequences of clan culture.
{"title":"Does clan culture mitigate earnings management? Evidence from China","authors":"Xixiong Xu , Linchun Wu , Cuiliang Lin , Weiyu Gan","doi":"10.1016/j.ribaf.2025.103220","DOIUrl":"10.1016/j.ribaf.2025.103220","url":null,"abstract":"<div><div>We examine the effect of clan culture on corporate earnings management and delineate its underlying mechanism from an institutional theory perspective. Our findings reveal that firms with stronger clan culture have a lower level of earnings management. The transmission mechanism tests demonstrate that clan culture can reduce the earnings management through enhancing ethical constraints, reinforcing resource sharing, and fostering long-term orientation. Furthermore, the negative influence of clan culture on earnings management is more significant in firms with worse audit quality, less foreign cultural experience, lower marketization level, and higher degree of openness. This study not only extends our understanding of the determinants of earnings management from the perspective of informal institutions but also enriches the research on the economic consequences of clan culture.</div></div>","PeriodicalId":51430,"journal":{"name":"Research in International Business and Finance","volume":"81 ","pages":"Article 103220"},"PeriodicalIF":6.9,"publicationDate":"2025-11-19","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"145571271","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-11-19DOI: 10.1016/j.ribaf.2025.103218
Muhammad Farhan Bashir , Fouad Jamaani , Jue Wang , Huan Huang
The global call for energy decarbonization and environmental progress requires augmented financial support to fund climate adaption and withstand climate change ramifications. The current study uses a balanced panel dataset to investigates the role of energy aid in expediting energy transition in South Asian economies from 2002 to 2022. Our extensive econometric analysis helps us determine that energy aid is essential to promoting energy transition in South Asia. from macroeconomic perspective, energy efficiency, institutional quality and human development help foster energy transition through green energy developments whereas, population growth, foreign direct investments and economic growth hinder energy transition. We further substitute energy aid sub-components within the empirical model to conclude that renewable energy aid, non-renewable energy aid, energy policy aid, and energy distribution aid are key to the structural energy shifts and facilitate long-term energy transition process. We conclude our investigation by reporting novel policy suggestions to energy aid distribution aimed at donors and recipients alike to augment energy aid’s efficacy in net-zero transition and climate change adaptation
{"title":"Analyzing the dynamic impact of energy aid on energy transition in South Asia: Policy implications for renewable adaptive capacity and energy decarbonization","authors":"Muhammad Farhan Bashir , Fouad Jamaani , Jue Wang , Huan Huang","doi":"10.1016/j.ribaf.2025.103218","DOIUrl":"10.1016/j.ribaf.2025.103218","url":null,"abstract":"<div><div>The global call for energy decarbonization and environmental progress requires augmented financial support to fund climate adaption and withstand climate change ramifications. The current study uses a balanced panel dataset to investigates the role of energy aid in expediting energy transition in South Asian economies from 2002 to 2022. Our extensive econometric analysis helps us determine that energy aid is essential to promoting energy transition in South Asia. from macroeconomic perspective, energy efficiency, institutional quality and human development help foster energy transition through green energy developments whereas, population growth, foreign direct investments and economic growth hinder energy transition. We further substitute energy aid sub-components within the empirical model to conclude that renewable energy aid, non-renewable energy aid, energy policy aid, and energy distribution aid are key to the structural energy shifts and facilitate long-term energy transition process. We conclude our investigation by reporting novel policy suggestions to energy aid distribution aimed at donors and recipients alike to augment energy aid’s efficacy in net-zero transition and climate change adaptation</div></div>","PeriodicalId":51430,"journal":{"name":"Research in International Business and Finance","volume":"81 ","pages":"Article 103218"},"PeriodicalIF":6.9,"publicationDate":"2025-11-19","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"145571272","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-11-17DOI: 10.1016/j.ribaf.2025.103223
Lee A. Smales
There is a well-established relationship between sentiment and financial market returns. We focus on the sentiment-return association for CME Nikkei futures, US-traded futures with a Japanese underlying asset. Using a unique dataset of news published in English and Japanese languages, we establish measures of ‘fundamental sentiment’ related to the underlying Japanese stocks, and ‘local sentiment’ for US stocks trading in the same timezone as the major futures traders. Our empirical results demonstrate that news in diverse languages is important. ‘Fundamental sentiment’ related to the underlying stocks is most salient for futures returns. However, ‘local sentiment’ plays a significant role during recession and in the distribution tail. This emphasizes the importance of economic agents considering news from multiple sources when making decisions.
{"title":"When news travels: The role of sentiment in CME Nikkei futures returns","authors":"Lee A. Smales","doi":"10.1016/j.ribaf.2025.103223","DOIUrl":"10.1016/j.ribaf.2025.103223","url":null,"abstract":"<div><div>There is a well-established relationship between sentiment and financial market returns. We focus on the sentiment-return association for CME Nikkei futures, US-traded futures with a Japanese underlying asset. Using a unique dataset of news published in English and Japanese languages, we establish measures of ‘fundamental sentiment’ related to the underlying Japanese stocks, and ‘local sentiment’ for US stocks trading in the same timezone as the major futures traders. Our empirical results demonstrate that news in diverse languages is important. ‘Fundamental sentiment’ related to the underlying stocks is most salient for futures returns. However, ‘local sentiment’ plays a significant role during recession and in the distribution tail. This emphasizes the importance of economic agents considering news from multiple sources when making decisions.</div></div>","PeriodicalId":51430,"journal":{"name":"Research in International Business and Finance","volume":"81 ","pages":"Article 103223"},"PeriodicalIF":6.9,"publicationDate":"2025-11-17","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"145571273","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-11-17DOI: 10.1016/j.ribaf.2025.103217
Chenyao Tang , Adelphe Ekponon
{"title":"Corrigendum to “Credit efficiency: Another early warning indicator for systemic risk” [Res. Int. Bus. Financ. 81 (2026) 103192]","authors":"Chenyao Tang , Adelphe Ekponon","doi":"10.1016/j.ribaf.2025.103217","DOIUrl":"10.1016/j.ribaf.2025.103217","url":null,"abstract":"","PeriodicalId":51430,"journal":{"name":"Research in International Business and Finance","volume":"81 ","pages":"Article 103217"},"PeriodicalIF":6.9,"publicationDate":"2025-11-17","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"145684251","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-11-15DOI: 10.1016/j.ribaf.2025.103212
Long Zhao , Di Fan , Caleb Huanyong Chen
Using firm-level data from the World Bank Enterprise Surveys (2006–2022), this study employs Probit models to examine the relationship between firms’ access to finance and their export decisions. We find strong evidence of an inverted-U relationship: firms facing severe financial constraints are more likely to export with improved financial access. However, once these firms attain sufficient financing, further alleviation of financial constraints does not yield additional incentives for exporting. Further analysis suggests that firm growth and innovation are two plausible channels through which access to finance affects firms’ decisions to export. These findings question the conventional belief that access to finance invariably promotes export activities, highlighting the necessity for policymakers to tailor trade policies according to specific circumstances.
{"title":"Access to finance and firm exporting: An inverted-U relationship","authors":"Long Zhao , Di Fan , Caleb Huanyong Chen","doi":"10.1016/j.ribaf.2025.103212","DOIUrl":"10.1016/j.ribaf.2025.103212","url":null,"abstract":"<div><div>Using firm-level data from the World Bank Enterprise Surveys (2006–2022), this study employs Probit models to examine the relationship between firms’ access to finance and their export decisions. We find strong evidence of an inverted-U relationship: firms facing severe financial constraints are more likely to export with improved financial access. However, once these firms attain sufficient financing, further alleviation of financial constraints does not yield additional incentives for exporting. Further analysis suggests that firm growth and innovation are two plausible channels through which access to finance affects firms’ decisions to export. These findings question the conventional belief that access to finance invariably promotes export activities, highlighting the necessity for policymakers to tailor trade policies according to specific circumstances.</div></div>","PeriodicalId":51430,"journal":{"name":"Research in International Business and Finance","volume":"81 ","pages":"Article 103212"},"PeriodicalIF":6.9,"publicationDate":"2025-11-15","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"145571274","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-11-14DOI: 10.1016/j.ribaf.2025.103210
Albert Wijeweera, Michael Alexander Kortt, Namwoon Kim
This study examines whether disaggregated components of Environmental, Social, and Governance (ESG) factors, namely, environmental, social, and governance scores, provide superior explanatory power in understanding share return performance compared to aggregate ESG scores. We analyse the relationship between firm size, ESG factors, and share returns by estimating augmented Capital Asset Pricing Models (CAPM) using data from 426 S&P 500 companies in 2023. Initially, a CAPM model incorporating the aggregate ESG score is estimated, followed by an extended model including disaggregated ESG components and interaction terms between ESG variables and market beta. Our findings suggest that the aggregate ESG score does not have a statistically significant direct effect on share returns. However, when disaggregated, the governance component of ESG exhibits a moderately significant negative association with share returns, implying that strong governance may reduce perceived risk, leading investors to accept lower return premiums. Although the environmental and social scores do not have a direct impact on share returns, all three ESG components exhibit significant interactions with systematic risk. This suggests that the influence of ESG on share returns arises not from the standalone ESG factors themselves, but from how these factors shape or reflect the firm’s risk environment in relation to systematic risk. In particular, environmental and governance performance scores reduce risk premiums in high-beta firms, while social performance may increase them. These results highlight the limitations of traditional asset pricing models that exclude disaggregated ESG scores and their interaction with systematic risk. The study emphasises the importance of incorporating disaggregated ESG components into multifactor investment models to more accurately capture the risk–return profile of listed firms.
{"title":"Dissecting ESG: Do environmental, social, and governance pillars influence share returns differently?","authors":"Albert Wijeweera, Michael Alexander Kortt, Namwoon Kim","doi":"10.1016/j.ribaf.2025.103210","DOIUrl":"10.1016/j.ribaf.2025.103210","url":null,"abstract":"<div><div>This study examines whether disaggregated components of Environmental, Social, and Governance (ESG) factors, namely, environmental, social, and governance scores, provide superior explanatory power in understanding share return performance compared to aggregate ESG scores. We analyse the relationship between firm size, ESG factors, and share returns by estimating augmented Capital Asset Pricing Models (CAPM) using data from 426 S&P 500 companies in 2023. Initially, a CAPM model incorporating the aggregate ESG score is estimated, followed by an extended model including disaggregated ESG components and interaction terms between ESG variables and market beta. Our findings suggest that the aggregate ESG score does not have a statistically significant direct effect on share returns. However, when disaggregated, the governance component of ESG exhibits a moderately significant negative association with share returns, implying that strong governance may reduce perceived risk, leading investors to accept lower return premiums. Although the environmental and social scores do not have a direct impact on share returns, all three ESG components exhibit significant interactions with systematic risk. This suggests that the influence of ESG on share returns arises not from the standalone ESG factors themselves, but from how these factors shape or reflect the firm’s risk environment in relation to systematic risk. In particular, environmental and governance performance scores reduce risk premiums in high-beta firms, while social performance may increase them. These results highlight the limitations of traditional asset pricing models that exclude disaggregated ESG scores and their interaction with systematic risk. The study emphasises the importance of incorporating disaggregated ESG components into multifactor investment models to more accurately capture the risk–return profile of listed firms.</div></div>","PeriodicalId":51430,"journal":{"name":"Research in International Business and Finance","volume":"81 ","pages":"Article 103210"},"PeriodicalIF":6.9,"publicationDate":"2025-11-14","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"145571277","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-11-14DOI: 10.1016/j.ribaf.2025.103214
Idrees Liaqat , Josanco Floerani , Mirza Muhammad Naseer
Why does ESG stabilize banks in some countries but not others? We argue that the inconsistent relationship between ESG performance and bank stability stems from a neglect of macro-level institutional contexts. While emerging research explores how national culture shapes ESG performance or how ESG performance affects liquidity and stability, no study integrates these perspectives to explain bank stability. We posit that national culture (as an informal institution) and formal institutions are critical, competing moderators that explain this heterogeneity. Using a global sample of 660 banks from 2002 to 2023, we find that ESG performance enhances bank stability, but predominantly in individualistic cultures. In contrast, high levels of uncertainty avoidance, power distance, and long-term orientation diminish this stabilizing effect. Strong formal institutions, however, positively moderate the ESG–stability relationship. Further analysis reveals that bank liquidity and funding costs act as key transmission channels. Our findings are robust to alternative model specifications and proxy measures. Sub-sample analyses indicate divergent patterns across the pre- and post-Paris Agreement periods and banks operating in developed vs developing economies. These results offer valuable implications for regulators and bank executives seeking to tailor ESG strategies to specific institutional and cultural environments.
{"title":"ESG performance and Bank stability: The role of national culture and formal institutions","authors":"Idrees Liaqat , Josanco Floerani , Mirza Muhammad Naseer","doi":"10.1016/j.ribaf.2025.103214","DOIUrl":"10.1016/j.ribaf.2025.103214","url":null,"abstract":"<div><div>Why does ESG stabilize banks in some countries but not others? We argue that the inconsistent relationship between ESG performance and bank stability stems from a neglect of macro-level institutional contexts. While emerging research explores how national culture shapes ESG performance or how ESG performance affects liquidity and stability, no study integrates these perspectives to explain bank stability. We posit that national culture (as an informal institution) and formal institutions are critical, competing moderators that explain this heterogeneity. Using a global sample of 660 banks from 2002 to 2023, we find that ESG performance enhances bank stability, but predominantly in individualistic cultures. In contrast, high levels of uncertainty avoidance, power distance, and long-term orientation diminish this stabilizing effect. Strong formal institutions, however, positively moderate the ESG–stability relationship. Further analysis reveals that bank liquidity and funding costs act as key transmission channels. Our findings are robust to alternative model specifications and proxy measures. Sub-sample analyses indicate divergent patterns across the pre- and post-Paris Agreement periods and banks operating in developed vs developing economies. These results offer valuable implications for regulators and bank executives seeking to tailor ESG strategies to specific institutional and cultural environments.</div></div>","PeriodicalId":51430,"journal":{"name":"Research in International Business and Finance","volume":"81 ","pages":"Article 103214"},"PeriodicalIF":6.9,"publicationDate":"2025-11-14","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"145520564","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
Pub Date : 2025-11-13DOI: 10.1016/j.ribaf.2025.103215
Maria Cristina Arcuri , GINO GANDOLFI , RAOUL PISANI
This study explores if Italian MSMEs (Micro, Small, Medium-sized Enterprises) operating in green industries (green MSMEs) are recognized more creditworthy by the banking system than those operating in non-green sectors (non-green MSMEs). In more detail, we explore first if Italian green MSMEs receive more bank credit and have less cost of credit, second if they have a better creditworthiness (in terms of lower probability of default) than non-green ones. We carry out a panel regression with 245,784 observations, of which 7896 refer to green firms and 237,888 to non-green firms over the period 2015–2022. Propensity score matching is also used to check for potential selection bias. Due to the lack of a mandatory green rating, the analysis was not conducted at the level of green enterprises but on “green” industries defined as such based on an assumed particularly high green component. Our results show that Italian green MSMEs pay a higher cost of funding rather than non-green ones and this seems to be, at least partially, justified by a corresponding higher credit risk; differences emerges when the size of enterprises is considered. Public policies should therefore promote the requirement of a green rating based on a rigorous and uniform methodology and provided by an agency that may be promoted by Public Authorities. This would allow for more accurate and objective assessments of the creditworthiness of green companies, improving their access to credit and reducing exposure of banks to credit risk.
{"title":"Italian SMEs and access to credit: Does being “green” matter?","authors":"Maria Cristina Arcuri , GINO GANDOLFI , RAOUL PISANI","doi":"10.1016/j.ribaf.2025.103215","DOIUrl":"10.1016/j.ribaf.2025.103215","url":null,"abstract":"<div><div>This study explores if Italian MSMEs (Micro, Small, Medium-sized Enterprises) operating in green industries (green MSMEs) are recognized more creditworthy by the banking system than those operating in non-green sectors (non-green MSMEs). In more detail, we explore first if Italian green MSMEs receive more bank credit and have less cost of credit, second if they have a better creditworthiness (in terms of lower probability of default) than non-green ones. We carry out a panel regression with 245,784 observations, of which 7896 refer to green firms and 237,888 to non-green firms over the period 2015–2022. Propensity score matching is also used to check for potential selection bias. Due to the lack of a mandatory green rating, the analysis was not conducted at the level of green enterprises but on “green” industries defined as such based on an assumed particularly high green component. Our results show that Italian green MSMEs pay a higher cost of funding rather than non-green ones and this seems to be, at least partially, justified by a corresponding higher credit risk; differences emerges when the size of enterprises is considered. Public policies should therefore promote the requirement of a green rating based on a rigorous and uniform methodology and provided by an agency that may be promoted by Public Authorities. This would allow for more accurate and objective assessments of the creditworthiness of green companies, improving their access to credit and reducing exposure of banks to credit risk.</div></div>","PeriodicalId":51430,"journal":{"name":"Research in International Business and Finance","volume":"81 ","pages":"Article 103215"},"PeriodicalIF":6.9,"publicationDate":"2025-11-13","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"145571269","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":2,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
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