Microfinance and Green Energy Lending: First Worldwide Evidence
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Microfinance and Green Energy Lending: First Worldwide Evidence
Dorfleitner, Gregor | Forcella, Davide | Nguyen, Quynh Anh
Credit and Capital Markets – Kredit und Kapital, Vol. 53 (2020), Iss. 4 : pp. 427–460
3 Citations (CrossRef)
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Prof. Dr. Gregor Dorfleitner, Department of Finance, University of Regensburg, 93040 Regensburg, Germany.
Davide Forcella, PhD, YAPU Solutions GmbH, Schönhauser Allee 44a, 10435 Berlin, Germany.
Quynh Anh Nguyen, Department of Finance, University of Regensburg, 93040 Regensburg, Germany.
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Google Scholar -
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Google Scholar -
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Google Scholar -
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Google Scholar -
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Google Scholar -
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Allet, M. (2014): Why do microfinance institutions go green? An exploratory study. Journal of Business Ethics 122, 405–424.
Google Scholar -
Allet, M./Hudon, M. (2015): Green microfinance: Characteristics of microfinance institutions involved in environmental management. Journal of Business Ethics 126, 395–414.
Google Scholar -
Baker, L. (2015): The evolving role of finance in South Africa’s renewable energy sector. Geoforum 64, 146–156.
Google Scholar -
Ben-Amar, W./Chang, M./McIlkenny, P. (2017): Board gender diversity and corporate response to sustainability initiatives: Evidence from the carbon disclosure project. Journal of Business Ethics 142, 369–383.
Google Scholar -
Bhattacharya, M./Churchill, S. A./Paramati, S. R. (2017): The dynamic impact of renewable energy and institutions on economic output and CO2 emissions across regions. Renewable Energy 111, 157–167.
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Birindelli, G./Dell’Atti, S./Iannuzzi, A. P./Savioli, M. (2018): Composition and activity of the board of directors: Impact on ESG performance in the banking system. Sustainability 10, 4699.
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Google Scholar -
Brunnschweiler, C. N. (2010): Finance for renewable energy: An empirical analysis of developing and transition economies. Environment and Development Economics 15, 241–274.
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Buchanan, R. W./Gillies, C. S. (1990): Value managed relationships: The key to customer retention and profitability. European Management Journal 8, 523–526.
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Byrnes, J. P./Miller, D. C./Schafer, W. D. (1999): Gender differences in risk taking: A meta-analysis. Psychological Bulletin 125, 367–383.
Google Scholar -
Cárdenas Rodríguez, M./Hašcic, I./Johnstone, N./Silva, J./Ferey, A. (2014): Inducing private finance for renewable energy projects: Evidence from microdata. Technical Report. OECD Publishing.
Google Scholar -
Chang, C. H. (2016): The determinants of green product innovation performance. Corporate Social Responsibility and Environmental Management 23, 65–76.
Google Scholar -
Charness, G./Gneezy, U. (2012): Strong evidence for gender differences in risk taking. Journal of Economic Behavior & Organization 83, 50–58.
Google Scholar -
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Google Scholar -
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Google Scholar -
D’Espallier, B./Guerin, I./Mersland, R. (2013): Focus on women in microfinance institutions. The Journal of Development Studies 49, 589–608.
Google Scholar -
Dorfleitner, G./Röhe, M./Renier, N. (2017): The access of microfinance institutions to debt capital: An empirical investigation of microfinance investment vehicles. The Quarterly Review of Economics and Finance 65, 1–15.
Google Scholar -
Dowla, A. (2018): Climate change and microfinance. Business Strategy & Development 1, 78–87.
Google Scholar -
Ertac, S./Gurdal, M. Y. (2012): Deciding to decide: Gender, leadership and risk-taking in groups. Journal of Economic Behavior & Organization 83, 24–30.
Google Scholar -
Forcella, D./Allet, M./Ramírez, J. (2015): MFIs’ environmental performance in Central America under a context of climate change. Passerelles, Microfinance and Climate Change Bridging academic research with field practice. ISSN 2354-5402 No1.
Google Scholar -
Forcella, D./Castellani, D./Huybrechs, F./Allet, M. (2017): Green microfinance in Latin America and the Caribbean: An Analysis of Opportunities. IDB-MG-658. Washington, D.C: Inter-American Development Bank.
Google Scholar -
Forcella, D./Hudon, M. (2016): Green microfinance in europe. Journal of Business Ethics 135, 445–459.
Google Scholar -
Forcella, D./Huybrechs, F. (2016): Green Microfinance and Ecosystem Services – A quantitative study on outcomes and effectiveness. Working Papers CEB 16-018. ULB – Universite Libre de Bruxelles. URL: https://ideas.repec.org/p/sol/wpaper/2013-228525.html.
Google Scholar -
Goldemberg, J., et al. (2000): World Energy Assessment: Energy and the challenge of sustainability. United Nations Development Programme, New York.
Google Scholar -
Harrold, M./Agrawala, S./Steele, P./Sharma, A./Hirsch, D./Liptow, H./Sharma, M./Abeygunawardena, P./Foy, T./Debois, M., et al. (2009): Poverty and climate change: Reducing the vulnerability of the poor through adaptation. http://documents1.worldbank.org/curated/en/534871468155709473/pdf/521760WP0pover1e0Box35554B01PUBLIC1.pdf.
Google Scholar -
Haseeb, M./Abidin, I. S. Z./Hye, Q. M. A./Hartani, N. H. (2019): The impact of renewable energy on economic well-being of Malaysia: Fresh evidence from auto regressive distributed lag bound testing approach. International Journal of Energy Economics and Policy 9, 269.
Google Scholar -
Helgeson, J. G./Voss, K. E./Terpening, W. D. (2002): Determinants of mail-survey response: Survey design factors and respondent factors. Psychology & Marketing 19, 303–328.
Google Scholar -
Huybrechs, F./Bastiaensen, J./Forcella, D. (2015): Guest editorial: An introduction to the special issue on green microfinance. Enterprise Development and Microfinance 26, 211–214.
Google Scholar -
IEA (2019): Global energy & CO2 status report. IEA (International Energy Agency): Paris, France. https://www.iea.org/reports/global-energy-co2-status-report-2019.
Google Scholar -
Inglesi-Lotz, R. (2016): The impact of renewable energy consumption to economic growth: A panel data application. Energy Economics 53, 58–63.
Google Scholar -
Kyereboah-Coleman, A. (2007): The impact of capital structure on the performance of microfinance institutions. The Journal of Risk Finance 8, 56–71.
Google Scholar -
Lee, C. W./Zhong, J. (2015): Financing and risk management of renewable energy projects with a hybrid bond. Renewable Energy 75, 779–787.
Google Scholar -
Lewis, J. I. (2010): The evolving role of carbon finance in promoting renewable energy development in China. Energy Policy 38, 2875–2886.
Google Scholar -
Liao, L./Luo, L./Tang, Q. (2015): Gender diversity, board independence, environmental committee and greenhouse gas disclosure. The British Accounting Review 47, 409–424.
Google Scholar -
Liu, X./Zeng, M. (2017): Renewable energy investment risk evaluation model based on system dynamics. Renewable and Sustainable Energy Reviews 73, 782–788.
Google Scholar -
Mandil, C. (2005): Energy statistics–manual. Int Energy Agency, Paris, Fr, 1–196.
Google Scholar -
Martinot, E. (2001): Renewable energy investment by the World Bank. Energy Policy 29, 689–699.
Google Scholar -
Masini, A./Menichetti, E. (2012): The impact of behavioural factors in the renewable energy investment decision making process: Conceptual framework and empirical findings. Energy Policy 40, 28–38.
Google Scholar -
Mazzucato, M./Semieniuk, G. (2018): Financing renewable energy: Who is financing what and why it matters. Technological Forecasting and Social Change 127, 8–22.
Google Scholar -
Mersland, R./Urgeghe, L. (2013): International debt financing and performance of microfinance institutions. Strategic Change 22, 17–29.
Google Scholar -
Moser, R./Forcella, D./Farias, L. E. G. (2016): Microfinance and climate change: Threats and opportunities, the case of Brazil’s largest rural MFIs, Agroamigo and Cresol. Working Papers CEB 16-010. ULB – Universite Libre de Bruxelles. https://ideas.repec.org/p/sol/wpaper/2013-225672.html.
Google Scholar -
Narbel, P. A. (2013): The likely impact of Basel III on a bank’s appetite for renewable energy financing. Discussion Paper 2013/10 Norwegian School of Economics, Dept. of Business and Management Science.
Google Scholar -
Nepal, G./Amatya, V. B. (2006): Understanding rural energy programme and poverty reduction linkage: An empirical study of Nepal. Energy Sector Assistance Programme, Alternative Energy Promotion Centre.
Google Scholar -
Nerini, F. F./Tomei, J./To, L. S./Bisaga, I./Parikh, P./Black, M./Borrion, A./Spataru, C., Broto, V. C., Anandarajah, G., et al. (2018): Mapping synergies and trade-offs between energy and the sustainable development goals. Nature Energy 3, 10–15.
Google Scholar -
Oyeniyi, O., Abiodun, A. (2010): Switching cost and customers loyalty in the mobile phone market: The Nigerian experience. Business Intelligence Journal 3, 111–121.
Google Scholar -
Pantoja, E. (2002): Microfinance and disaster risk management: Experiences and lessons learned. The World Bank. Washington, D.C. https://www.gdrc.org/icm/disasters/microfinance_drm.pdf.
Google Scholar -
Peimani, H. (2018): Financial barriers to development of renewable and green energy projects in Asia. Technical Report. ADBI Working Paper Series.
Google Scholar -
Rao, P. S. C./Miller, J. B./Wang, Y. D./Byrne, J. B. (2009): Energy-microfinance intervention for below poverty line households in India. Energy Policy 37, 1694–1712.
Google Scholar -
Reichheld, F. F. (1993): Loyalty-based management. Harvard Business Review 71, 64–73.
Google Scholar -
Reichheld, F. F. (2001): Lead for loyalty. Harvard Business Review 79, 76–84.
Google Scholar -
Reichheld, F. F./Kenny, D. W. (1990): The hidden advantages of customer retention. Journal of Retail Banking 12, 19–24.
Google Scholar -
Rippey, P. (2012): Microfinance and climate change: Threats and opportunities, in: Greening the Financial Sector. Springer, pp. 215–239.
Google Scholar -
Rodríguez, M. C./Hašcic, I./Johnstone, N./Silva, J./Ferey, A. (2015): Renewable energy policies and private sector investment: Evidence from financial microdata. Environmental and Resource Economics 62, 163–188.
Google Scholar -
Sachs, J. D./Woo, W. T./Yoshino, N./Taghizadeh-Hesary, F. (2019): Importance of green finance for achieving sustainable development goals and energy security. Handbook of Green Finance: Energy Security and Sustainable Development, 3–12.
Google Scholar -
Stiglitz, J. E. (1990): Peer monitoring and credit markets. The World Bank Economic Review 4, 351–366.
Google Scholar -
Strøm, R. Ø./D’Espallier, B./Mersland, R. (2014): Female leadership, performance, and governance in microfinance institutions. Journal of Banking & Finance 42, 60–75.
Google Scholar -
Surendra, K./Takara, D./Hashimoto, A. G./Khanal, S. K. (2014): Biogas as a sustainable energy source for developing countries: Opportunities and challenges. Renewable and Sustainable Energy Reviews 31, 846–859.
Google Scholar -
Taghizadeh-Hesary, F./Yoshino, N. (2019): The way to induce private participation in green finance and investment. Finance Research Letters 31, 98–103.
Google Scholar -
UN (2015): Transforming our world: The 2030 agenda for sustainable development. General Assembley 70 session, A/RES/70/1.
Google Scholar -
UNEP FI (2012): Financing renewable energy in developing countries: Drivers and barriers for private finance in sub-saharan africa. United Nations Environment Programme Finance Initiative.
Google Scholar -
UNFCCC (2015): 1/CP. 21, Adoption of the Paris Agreement. Conference of the Parties to the United Nations Framework Convention on Climate Change. FCCC/CP/2015/10/Add. 1.
Google Scholar -
Vanroose, A./D’Espallier, B. (2013): Do microfinance institutions accomplish their mission? Evidence from the relationship between traditional financial sector development and microfinance institutions’ outreach and performance. Applied Economics 45, 1965–1982.
Google Scholar -
Vermeulen, P. A./De Jong, J. P./O’shaughnessy, K. C. (2005): Identifying key determinants for new product introductions and firm performance in small service firms. The Service Industries Journal 25, 625–640.
Google Scholar -
Walekhwa, P. N./Mugisha, J./Drake, L. (2009): Biogas energy from family-sized digesters in Uganda: Critical factors and policy implications. Energy Policy 37, 2754–2762.
Google Scholar -
World Bank (2012): Nepal – biogas support program iv (bsp) project (english). https://documents.worldbank.org/en/publication/documents-reports/documentdetail/685071 468062634265/nepal-biogas-support-program-iv-bsp-project.
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Abstract
The increasing requirement for action on climate change in developing countries has led to the inclusion of environmental aspects in microfinance objectives, in addition to social and financial performance, and hence to the appearance of green microfinance. To date, financing for modern energy service has proven to be an attractive option to offset adverse climate change related effects for the poor. This article sheds some light on factors predicting clean energy finance involvement of MFIs. By using a worldwide survey among microfinance institutions on rural lending and IT solutions implemented by YAPU Solutions, this study investigates how institutional characteristics and economic growth relate to green energy micro-credit. The findings provide evidence of a significantly positive relationship between the maturity and business sustainability of an MFI and the likelihood of offering green energy loans. Moreover, MFIs managed by female managers and located in wealthy countries are less willing to commence the finance of green energy.