The Synergy Between ESG and Green Finance

Pursuit of sustainable corporate development has attracted increasing scholarly and policy interest. This paper reviewed domestic and foreign research on ESG and green finance. We found that both external and internal factors can affect a companys ESG; although good ESG performance can increase a companys stock price and reduce the issuance rate of the bonds, its impact on corporate performance is not clear. In addition, green finance can reduce the credit risks of commercial banks, alleviate enterprises financing constraints and promote them to carry out green technology innovation at the micro level and can help a country achieve the transformation of its industrial structure at the macro level. Furthermore, the development of green finance can not only provide financial support for enterprises to promote the innovation of green technologies but also encourage more companies to improve their ESG performance; the prevalence of ESG can also in turn improve the efficiency of resource allocation in the whole society and promote the further development of green finance. This paper aims to help relevant personnel deepen their understanding of ESG and green finance, expand the scope of research in related fields, and ultimately provide guidance for enterprises to achieve sustainable development.