The importance of green patents for CDS pricing: The role of environmental disclosures
研究美国企业2002-2020年数据发现，拥有更多绿色专利的企业信用违约互换利差更低，且企业自愿披露环境信息会增强这一效应，而媒体等外部渠道的非自愿环境曝光则会削弱它。
Corporate green innovation to address global climate change has potential spillover effects through positive financial outcomes. This study examines how the credit market takes green innovation, measured by the approval of green patents, into account to determine the credit default swap (CDS) premia. Using a sample of United States (US) firms from 2002 to 2020, this research finds that the CDS market favourably prices green innovation: firms with more green patents have lower CDS spread, suggesting that the CDS market considers firms' green innovation in their investment decision. While greater firm-provided environmental disclosures boost the effect of green innovation, involuntary environmental exposures by external channels such as print and online media offset the favourable effect of green innovation on CDS spread. The green technology pilot program by the US Patent and Trademark Office in 2009 is exploited as a quasi-natural experimental setting to apply a difference-in-differences analysis, confirming the favourable effect of green innovation on CDS spread. The results remain robust to various sensitivity and other endogeneity tests. Managers intending to reconcile green innovation with their stakeholder value maximisation objective may find the findings interesting. • The credit default swap (CDS) market favourably prices green innovation. • The number of green patents issued to a firm is negatively associated with the CDS spread. • Firm-provided and involuntary environmental disclosures play distinct roles in the green innovation-CDS spread link. • The green technology pilot program by the USPTO significantly reduced the CDS spread of the participating firms. • Firms with a greater number of green patents tend to have better credit ratings.