Green Credit, ESG Ratings, and Corporate Carbon Emission Management Practices

Abstract

Green Finance Interaction with Corporate Sustainability: An essential topic to explore for investigating whether improvements in carbon emissions are accelerating as a result of changes in market operations. Through a study of the mechanism by which green credit policies and ESG rating information together affect corporate carbon-emission-related behaviour to explore the complementary relationship and contradictions among these two indicators. Based on the theory of stakeholders, signal transmission, regulatory compliance and others, this paper constructs an analytical framework for exploring how green credit acts through financial cost channels and monitoring mechanisms to stimulate low-carbon investments; Based on these theories, it is also expected that changes in ESG ratings will affect companies'carbon disclosure and management behaviours by altering reputation alcosts and capital-market signals. Based on this, it has been found that there is a structural contradiction between the substantial carbon-reduction incentive embedded in well-structured green credit systems and the symbolic-compliance strategy driven by ESG rating divergences; Therefore, to improve corporate carbon-management efficiency, coordination among newgreenfinance-instrument design and ESG-disclosure-standardisation should be established.