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An efficiency perspective on carbon emissions and financial performance
Item metadata
dc.contributor.author | Trinks, Arjan | |
dc.contributor.author | Mulder, Machiel | |
dc.contributor.author | Scholtens, Bert | |
dc.date.accessioned | 2020-06-03T13:30:01Z | |
dc.date.available | 2020-06-03T13:30:01Z | |
dc.date.issued | 2020-09 | |
dc.identifier | 266558701 | |
dc.identifier | 180b9226-00e5-404b-88aa-ae906b343438 | |
dc.identifier | 85085603202 | |
dc.identifier | 000539110100001 | |
dc.identifier.citation | Trinks , A , Mulder , M & Scholtens , B 2020 , ' An efficiency perspective on carbon emissions and financial performance ' , Ecological Economics , vol. 175 , 106632 . https://doi.org/10.1016/j.ecolecon.2020.106632 | en |
dc.identifier.issn | 0921-8009 | |
dc.identifier.other | ORCID: /0000-0001-5774-5191/work/75248640 | |
dc.identifier.uri | https://hdl.handle.net/10023/20043 | |
dc.description.abstract | International policy actions to constrain carbon emissions create substantial risks and opportunities for firms. In particular, production processes that are relatively high emitting will be more sensitive to uncertain costs of emitting carbon dioxide and might further reflect productive inefficiencies. We employ a productive efficiency model to evaluate firms’ carbon emission levels relative to those of best practice (efficient) peers with comparable production structures. By accounting for total factor productivity and sector-relative performance aspects, this measure of carbon efficiency helps to quantify and rank firms’ relative dependency on carbon in the production process. We investigate the impact of carbon efficiency on various financial performance outcomes, and evaluate the role of general resource efficiency in explaining these impacts. Using an international sample of 1,572 firms over the years 2008-2016, we find superior financial performance in carbon efficient (best-practice) firms. On average, a 0.1 higher carbon efficiency is associated with a 1.0% higher profitability and 0.6% lower systematic risk. While carbon efficiency closely relates to resource efficiency, it also has distinct financial performance impacts, particularly lowering systematic risk. Overall, our findings suggest that carbon efficient production can be valuable from both operational and risk management perspectives. | |
dc.format.extent | 12 | |
dc.format.extent | 856947 | |
dc.language.iso | eng | |
dc.relation.ispartof | Ecological Economics | en |
dc.subject | Carbon efficiency | en |
dc.subject | Financial performance | en |
dc.subject | Total factor productivity | en |
dc.subject | Data envelopment analysis | en |
dc.subject | Directional distance function | en |
dc.subject | HD28 Management. Industrial Management | en |
dc.subject | HG Finance | en |
dc.subject | 3rd-DAS | en |
dc.subject | SDG 8 - Decent Work and Economic Growth | en |
dc.subject | SDG 12 - Responsible Consumption and Production | en |
dc.subject.lcc | HD28 | en |
dc.subject.lcc | HG | en |
dc.title | An efficiency perspective on carbon emissions and financial performance | en |
dc.type | Journal article | en |
dc.contributor.institution | University of St Andrews. Centre for Responsible Banking and Finance | en |
dc.contributor.institution | University of St Andrews. School of Management | en |
dc.identifier.doi | 10.1016/j.ecolecon.2020.106632 | |
dc.description.status | Peer reviewed | en |
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