Research on the Impact of Green Financing on Corporate Capital Structure
Research Article
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Research on the Impact of Green Financing on Corporate Capital Structure

Yunqi Fang 1*
1 University of Southampton
*Corresponding author: 15372093330@163.com
Published on 24 September 2025
Journal Cover
AEMPS Vol.221
ISSN (Print): 2754-1177
ISSN (Online): 2754-1169
ISBN (Print): 978-1-80590-391-8
ISBN (Online): 978-1-80590-392-5
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Abstract

Green finance has steadily grown to be a significant factor influencing the modification of corporate capital structures in recent years as investors have become more aware of ESG and global climate rules have gotten more stringent. However, how exactly green financing affects corporate capital structures remains a key issue of concern in both academia and practice. Motivated by this, this paper aims to explore the impact of green financing on corporate capital structures. Combining literature review and case analysis, this paper selects Apple Inc. and ExxonMobil as typical cases and reveals, through comparative analysis, the differentiated impacts of green financing on different types of enterprises. The results show that green financing has a debt redistribution effect: it can extend debt maturities, reduce financing costs, and decrease reliance on equity financing. At the equity structure level, green financing attracts long-term investors by enhancing a company’s “green reputation,” thereby stabilizing shareholder structures and lowering the cost of equity capital. In terms of capital costs, the “greenium” effect of green bonds and the accumulation of a long-term green reputation significantly optimize the weighted average cost of capital (WACC). In sum, green financing not only improves the stability of corporate capital structures but also enhances corporate value and sustainable development capacity.

Keywords:

Green financing, Capital structure, Debt structure, Equity structure, Capital cost

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Fang,Y. (2025). Research on the Impact of Green Financing on Corporate Capital Structure. Advances in Economics, Management and Political Sciences,221,1-6.

References

[1]. Edmans, A., & Kacperczyk, M. (2022). Sustainable Finance. Review of Finance.

[2]. Liang, H., & Renneboog, L. (2020). Corporate Social Responsibility and Sustainable Finance.

[3]. Zerbib, O. D. (2019). The effect of pro-environmental preferences on bond prices: Evidence from green bonds. Journal of Banking & Finance, 98, 39–60. https: //doi.org/10.1016/j.jbankfin.2018.10.012

[4]. Liu, Y., Zhang, S., Yang, L. (2022) 'The Impact of Green Finance on Enterprise Debt Financing—Evidence from China’, International Journal of Environmental Research and Public Health, 19(17), 11287. doi: 10.3390/ijerph191711287

[5]. Exxon Mobil Corporation. (2023). FORM 10-K FOR THE FISCAL YEAR ENDED DECEMBER 31, 2023. https: //investor.exxonmobil.com/sec-filings/annual-reports/content/0000034088-24-000018/0000034088-24-000018.pdf?utm_source.com

[6]. Apple. (2024). Annual Green Bond Impact Report: Fiscal Year 2024 Update. https: //www.apple.com/environment/pdf/Apple_Environmental_Progress_Report_2025.pdf#page=89

[7]. Zhang, X. & Chen, Y. (2023) 'Analysis and Suggestions on the Issuance of Green Bond—Taking Apple as an Example’, SHS Web of Conferences, 166, 02026. doi: 10.1051/shsconf/202316602026.

[8]. Flammer, C. (2020) Corporate green bonds. Boston University, Global Development Policy Center Working Paper, No. 033.

[9]. Tang, D. Y., & Zhang, Y. (2020). Do shareholders benefit from green bonds? Journal of Corporate Finance, 61, 101427. https: //doi.org/10.1016/j.jcorpfin.2018.12.001

[10]. Climate Bonds Initiative. (2021). Green Bond Pricing in the Primary Market: January–June 2021. Climate Bonds Initiative. Available at https: //www.climatebonds.net/news-events/press-room/press-releases/green-bond-pricing-primary-market-climate-bonds-releases-third-report-series

[11]. Zhang, D. (2021). Green bond issuance and corporate cost of capital. Journal of Corporate Finance. Available at: https: //lnu.diva-portal.org/smash/record.jsf?pid=diva2%3A1528796

[12]. Petreski, M., Schäfer, D. & Stephan, A. (2025). The reputation effect of repeated green-bond issuance. Business Strategy and the Environment, 34(2), 4111–4129. https: //doi.org/10.1002/bse.4111

[13]. World Scientific. (2025). Corporate Green Bonds and the Cost of Capital. In: Handbook of Green Finance. World Scientific Publishing. Available at: https: //www.worldscientific.com/doi/10.1142/9781800614451_0002.

[14]. People’s Bank of China (PBOC). (2017). Notice on the Pilot Zones for Green Finance Reform and Innovations. Beijing: People’s Bank of China. Available at: http: //www.pbc.gov.cn.

[15]. U.S. Congress. (2022). Inflation Reduction Act of 2022. Washington, D.C.: U.S. Government Publishing Office. Available at: https: //www.congress.gov/bill/117th-congress/house-bill/5376.

References

[1]. Edmans, A., & Kacperczyk, M. (2022). Sustainable Finance. Review of Finance.

[2]. Liang, H., & Renneboog, L. (2020). Corporate Social Responsibility and Sustainable Finance.

[3]. Zerbib, O. D. (2019). The effect of pro-environmental preferences on bond prices: Evidence from green bonds. Journal of Banking & Finance, 98, 39–60. https: //doi.org/10.1016/j.jbankfin.2018.10.012

[4]. Liu, Y., Zhang, S., Yang, L. (2022) 'The Impact of Green Finance on Enterprise Debt Financing—Evidence from China’, International Journal of Environmental Research and Public Health, 19(17), 11287. doi: 10.3390/ijerph191711287

[5]. Exxon Mobil Corporation. (2023). FORM 10-K FOR THE FISCAL YEAR ENDED DECEMBER 31, 2023. https: //investor.exxonmobil.com/sec-filings/annual-reports/content/0000034088-24-000018/0000034088-24-000018.pdf?utm_source.com

[6]. Apple. (2024). Annual Green Bond Impact Report: Fiscal Year 2024 Update. https: //www.apple.com/environment/pdf/Apple_Environmental_Progress_Report_2025.pdf#page=89

[7]. Zhang, X. & Chen, Y. (2023) 'Analysis and Suggestions on the Issuance of Green Bond—Taking Apple as an Example’, SHS Web of Conferences, 166, 02026. doi: 10.1051/shsconf/202316602026.

[8]. Flammer, C. (2020) Corporate green bonds. Boston University, Global Development Policy Center Working Paper, No. 033.

[9]. Tang, D. Y., & Zhang, Y. (2020). Do shareholders benefit from green bonds? Journal of Corporate Finance, 61, 101427. https: //doi.org/10.1016/j.jcorpfin.2018.12.001

[10]. Climate Bonds Initiative. (2021). Green Bond Pricing in the Primary Market: January–June 2021. Climate Bonds Initiative. Available at https: //www.climatebonds.net/news-events/press-room/press-releases/green-bond-pricing-primary-market-climate-bonds-releases-third-report-series

[11]. Zhang, D. (2021). Green bond issuance and corporate cost of capital. Journal of Corporate Finance. Available at: https: //lnu.diva-portal.org/smash/record.jsf?pid=diva2%3A1528796

[12]. Petreski, M., Schäfer, D. & Stephan, A. (2025). The reputation effect of repeated green-bond issuance. Business Strategy and the Environment, 34(2), 4111–4129. https: //doi.org/10.1002/bse.4111

[13]. World Scientific. (2025). Corporate Green Bonds and the Cost of Capital. In: Handbook of Green Finance. World Scientific Publishing. Available at: https: //www.worldscientific.com/doi/10.1142/9781800614451_0002.

[14]. People’s Bank of China (PBOC). (2017). Notice on the Pilot Zones for Green Finance Reform and Innovations. Beijing: People’s Bank of China. Available at: http: //www.pbc.gov.cn.

[15]. U.S. Congress. (2022). Inflation Reduction Act of 2022. Washington, D.C.: U.S. Government Publishing Office. Available at: https: //www.congress.gov/bill/117th-congress/house-bill/5376.

Cite this article

Fang,Y. (2025). Research on the Impact of Green Financing on Corporate Capital Structure. Advances in Economics, Management and Political Sciences,221,1-6.

Data availability

The datasets used and/or analyzed during the current study will be available from the authors upon reasonable request.

About volume

Volume title: Proceedings of ICFTBA 2025 Symposium: Global Trends in Green Financial Innovation and Technology

ISBN: 978-1-80590-391-8(Print) / 978-1-80590-392-5(Online)
Editor: Lukáš Vartiak, Sun Huaping
Conference website: https://www.icftba.org/Beijing.html
Conference date: 20 November 2025
Series: Advances in Economics, Management and Political Sciences
Volume number: Vol.221
ISSN: 2754-1169(Print) / 2754-1177(Online)

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