Financial efficiency of green projects.
https://doi.org/10.26794/1999-849X-2024-17-1-77-88
Abstract
The paradigm of sustainable development requires a large amount of equity and debt financing of relevant projects to achieveclimate goals. However, the required financing is not provided in full due to increased uncertainty in the economy, as well as uncertainty among investors and creditors about the financial success of green projects. It is assumed that this situation is largely determined by the difficulty for project initiators to correctly assess all aspects of their implementation, because many of them are influenced by behavioral economics factors that usually fall out of the field of view of scientists and practitioners when performing traditional financial analysis. The subject of the study is to ensure the financial efficiency of projects aimed at reducing/eliminating the negative impact on the environment. The purpose of the work is to identify the factors influencing the financial viability of green projects. The relationship between sustainable development and the financial results of the company’s activities has been revealed. The importance of the environmental factor affecting not only the cost of production, but also the preferences of customers in choosing a product is determined. The obstacles of a systemic nature preventing the involvement of banks in lending to green projects are substantiated. The financial aspects of solving the problem of ensuring the financial efficiency of green projects are investigated. It has been established that green goods open up new promising market segments for manufacturers and expand the circle of buyers, thereby reducing the cost of production of green goods and, in turn, increasing the effective demand for them. As a result of the work, it was concluded that in order to obtain an objectivepicture of a green project, it is necessary to take into account the cost of carbon emissions or exceeding the established quotas for them in the cost of production, as well as the fact that an increasing number of consumers are willing to buy environmentally friendly goods and pay more for them than their conventional counterparts
About the Authors
V. D. Smirnov
Financial University
Russian Federation
Russian Federation
Vladimir D. Smirnov — Cand. Sci. (Econ.), Assoc. Prof. of the Department of World Economy and World Finance
I. D. Tyukhmeneva
University of Padua
Italy
Italy
Irina D. Tyukhmeneva — graduate of the Bachelor’s degree; graduate
student
References
1. Friedman M. Capitalism and freedom. Chicago: University of Chicago Press; 1962. 202 p.
2. Freeman R.E. Strategic management a stakeholder approach. Boston: Pitman; 1984. 276 p.
3. Freeman R. E., McVea J. A Stakeholder approach to strategic management. URL: http://papers.ssrn.com/paper.taf?abstract_id=263511.
4. Полман П., Уинстон Э.С. Полный позитив. Формула выживания и процветания бизнеса в изменившемся мире. М.: Эксмо; 2023. 520 с. Polman P., Winston A. S. Totally positive. The formula for business survival and prosperity in a changed world. Moscow: Eksmo; 2023, 520 р. (In Russ.).
5. Serafeim G. Turning A. Profit while doing good aligning sustainability with corporate performance. center for effective public management at brookings. Corporate Sustainability and Financial Performance. December 2014. 17 p.
6. Yan X., Zhang Y. The effects of green innovation and environmental management on the environmental performance and value of a firm: an empirical study of energy-intensive listed companies in China.Environmental Science and Pollution Research International. 2021;28(27):35870–35879. DOI: 10.1007/s11356–021–12761–9
7. Ефимова О.В., Волков М.А., Королева Д.А. Анализ влияния принципов ESG на доходность активов: эмпирическое исследование. Финансы: теория и практика. 2021;25(4):82–97. Efimova O.V., Volkov M.A., Koroleva D.A. Analyzing the impact of ESG principles on asset returns: An empirical study. Finansy: teoriya i praktika = Finance: theory and practice. 2021;25(4):82–97. (In Russ.).
8. Park S.-B. Bringing strategy back in: corporate sustainability and firm performance.Journal of Cleaner Production. DOI: 10.1016/j.jclepro.2023.136012
9. Ambec S., Lanoie P. Does it pay to be green? A systematic overview. Academy of Management Perspectives. 2008;22(4):45–62.
10. Cestone G., White L. Anticompetitive financial contracting: the design of financial claims. Journal of Finance, American Finance Association. 2003;58(5):2109–2141.
11. Cetorelli N., Strahan P. E. Finance as a barrier to entry: bank competition and industry structure in local U.S. markets. Journal of Finance. 2006;61(1):437–461.
12. Cornaggia J., Mao Y., Tian X., Wolfe B. Does banking competition affect innovation? Journal of Financial Economics. 2015;115(1):189–209.
13. Degryse H., Roukny T., Tielens J. Banking barriers to the green economy. Working Paper Research from National Bank of Belgium, No. 391, October 2020. 32 p.
14. Reghezza A., Altunbas Y., Marques-Ibanez D., Rodriguez d’Acri C., Spaggiari M. Do banks fuel climate change? Journal of Financial Stability. 2022;62:101049.
15. Houston J. F., Shan H. Corporate ESG profiles and banking relationships. Review of Financial Studies, Society for Financial Studies. 2022;35(7):3373–3417.
16. Kacperczyk M. T., Peydro J.-L. Carbon emissions and the bank-lending channel (August 18, 2022). 69 p. DOI: 10.2139/ssrn.3915486
17. Kim S., Kumar N., Lee J., Oh J. ESG lending. european corporate governance institute working paper series in finance. Working Paper N° 817/2022. March 2023. 66 p.
18. Loumioti M., Serafeim G. The issuance and design of sustainability-linked loans. Harvard Business School. Working Paper 23–027; 2023. 73 p.
19. Kim S., Kumar N., Lee J., Oh J. ESG lending. european corporate governance institute working paper series in finance. Working Paper N° 817/2022. March 2023. 66 p.
20. Бобылев С.Н., Кирюшин П.А., Кошкина Н.Р. Новые приоритеты для экономики и зеленое финансирование. Экономическое возрождение России. 2021;67(1):152–166. Bobylev S.N., Kiryushin P.A., Koshkina N.R. New priorities for the economy and green financing.Ekonomicheskoe vozrozhdenie Rossii = Economic revival of Russia. 2021;67(1):152–166. (In Russ.).
21. Lu L., Taylor M. Which factors moderate the relationship between sustainability performance and financial performance? A Meta-Analysis Study. Journal of international accounting research. 2016;15:1–15.
22. Dimitrova T., Ilieva I., Angelova M. Exploring factors affecting sustainable consumption behaviour. Administrative Sciences. 2022;12(4):155. DOI: 10.3390/admsci12040155
Review
For citations:
Smirnov V.D., Tyukhmeneva I.D. Financial efficiency of green projects. Economics, taxes & law. 2024;17(1):77-88. (In Russ.) https://doi.org/10.26794/1999-849X-2024-17-1-77-88
Views:
13
Email this article 