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Green finance is a financial innovation that directs capital allocation towards green industries. How will this affect regional carbon emissions? Based on the data on green finance and carbon emissions of 30 provinces in China from 2008 to 2019, this paper employs a multivariate linear regression model and a spatial econometric model to empirically study the impact of green finance on carbon emissions. The results find that (1) green finance significantly reduces provincial carbon emissions, specifically through promoting a cleaner energy structure and an advanced industrial structure, as well as improving the quality of green innovation. (2) Heterogeneity exists between regions. In eastern regions and areas characterized by high levels of marketization and minimal fiscal pressure, the role of green finance in promoting provincial carbon emission reduction is more pronounced. (3) Spatial econometric analysis found that green finance has a significant spatial spillover effect on carbon reduction in adjacent regions. Specifically, the flow of green resources and green ideas between provinces facilitates the formation of regional radiation, while green competition generates a siphon effect on neighboring regions. These findings provide some meaningful policy implications to achieve China's dual-carbon goal by promoting green finance. • Green finance has significantly reduced China's provincial carbon emissions. • The upgrading of energy structure and industrial structure is a positive channel to reduce carbon emissions. • Green innovation strengthens the carbon reduction effect of green finance, but reveals the potential "greenwashing". • Green finance has a significant spatial spillover effect on carbon reduction in adjacent regions. • Policymakers should develop flexible, dynamic and coordinated green finance development policies. [ABSTRACT FROM AUTHOR]

Under the goal of "carbon peaking" and "carbon neutrality" in China, it is significant to explore whether emission reduction commitments contribute to carbon risk premium. Therefore, based on a sample of Chinese listed companies that publicly disclosed questionnaires in the CDP from 2009 to 2021, this paper empirically examines the relationship between emission reduction commitments and carbon risk premium and their formation mechanism. The results show that emission reduction commitments can effectively hedge the carbon risk premium, which pass several robustness tests. Specifically, the more comprehensive and ambitious the commitment is, the greater the suppression of the carbon risk premium. The mechanism test shows that disclosing emission reduction commitment information can reduce carbon risk by improving investor confidence and attracting political resources. Differences in enterprise emission levels, regional environmental regulation intensity and green financial development result in different risk-hedging effects of emission reduction commitments. Moreover, the greater the substantial pressure from stakeholders, the greater the tendency for firms to set up emission reduction commitments. Finally, the heterogeneity analysis reveals that confidence level of commitments has a significant impact on risk premium. Specifically, enterprises with SBTi validation, higher CDP ratings and higher target completion are more helpful in curbing carbon risk premium. Our findings contribute to corporate commitment to climate change and complement the carbon risk premium hypothesis. [Display omitted] The possible highlights of this study are as follows. • With the help of forward-looking information on emission reduction commitments, we re-examine the conclusion of the carbon risk premium and find that emission reduction commitments can effectively hedge the risk premium, enriching and developing the carbon risk premium hypothesis • This paper brings commitment levels and carbon emission levels into a unified analytical framework to study the correspondence between emission reduction commitments made under pressure to reduce emissions and the carbon risk premium, providing micro evidence for solving the mystery of the carbon risk premium. • Measure emission reduction commitment indicators from various angles, making the data on emission reduction commitments more objective and scientific. [ABSTRACT FROM AUTHOR]

Under the goal of "carbon peaking" and "carbon neutrality" in China, it is significant to explore whether green finance contributes to carbon emission reduction. Therefore, based on the panel data of 30 provinces in China from 2005 to 2020, this paper empirically examines the impact of green finance on carbon emissions and its mechanism using the FE model, GMM model, DID, and the mediating effect model. Results find that green finance can significantly promote carbon emissions reduction, and this promotion remains still after robustness tests. The heterogeneity analysis shows that green finance's carbon emission reduction effect is more significant in developed and western regions. Moreover, the results of policy intervention effects confirm that green finance reform and innovation pilot zones (GFRIs) for carbon emission reduction are more pronounced than in other regions. Finally, the mediating effects reveal that industrial structure and green innovation are the core transmission channels through which green finance influences carbon emission reduction. These findings offer meaningful implications for formulating reasonable carbon emission reduction plans and determining the future development direction of green finance. [ABSTRACT FROM AUTHOR]

Controlling carbon emissions and sustaining growth constitute essential concerns in the post-financial crisis era combined with low-carbon sustainable development. However, the impact of financial development on carbon emissions remains controversial and lacks mechanisms investigation covering finance spatial attributes. Relying on China province's data during 2005–2019, this paper contributes to the literature by constructing multi-spatial models to investigate how financial geo-density mitigates carbon emission intensity and explore the spatial transmission mechanisms. The results reveal that there is a balance between financial geo-density and carbon emission intensity. The intrinsic mechanisms include: (1) raising financial geo-density is accompanied by the law of marginal diminishing carbon emission intensity tendency; (2) high financial geo-density accelerates technological innovation and industrial structure upgrading, thereby decreasing carbon emission intensity, but drives industrial-scale expansion, thereby increasing carbon emission intensity; and (3) financial institution competition and inter-industry linkage notably influence the relationship between financial geo-density and carbon emission intensity, promoting the emission reduction effect of financial geo-density in accelerating technological innovation and industrial structure upgrading, and suppressing the emission increase effect of financial geo-density in driving industrial expansion. Our findings provide new insights for developing systemic emission reduction policies for employing financial sectors as catch-all and integrating industries and competition. • Mechanism analysis of financial geo-density affects carbon emission intensity (IC). • Propose an integrated spatial model including spatial mediated moderating effects. • Financial geo-density drives IC by industrial-scale expansion. • Reduce IC by technological innovation and industrial upgrading. • Financial institution rivalry and inter-industry link mitigate total driven effect. [ABSTRACT FROM AUTHOR]