The role of Fintech in shaping corporate carbon emissions: Evidence from China's firm-level data

This study examines the connection between the advancement of Fintech and corporate carbon emissions by constructing a theoretical model and validating it through the utilization of panel data sourced from Chinese listed enterprises. Our empirical analysis reveals a significant negative correlation, indicating that Fintech can effectively reduce emissions by alleviating financial constraints and fostering green innovation. These findings are robust to various tests and are confirmed through instrumental variable approaches. Our research further highlights that Fintech's emission-reduction effects are more pronounced in highly marketized environments with strong public environmental awareness. Non-state-owned enterprises and firms in less polluting industries are particularly responsive to Fintech's influence. This study makes several contributions to the existing literature. First, it provides novel firm-level evidence on the relationship between Fintech and carbon emissions. Second, it devises a theoretical framework and identifies key mechanisms through which Fintech influences corporate carbon emissions. Third, it develops a carbon estimation protocol to address data limitations in emerging markets. Finally, it uncovers diverse effects across different market and firm contexts. The results offer valuable policy implications, guiding the promotion of sustainable corporate practices and the achievement of environmental sustainability through targeted interventions.