CO2 Emissions and Financial Performance of Socially Responsible Firms: An Empirical Survey

Business Strategy and the Environment

Volumn 22, Issue 2, 2013, Pages 109-120

  Sariannidis, Nikolaos ^a   Zafeiriou, Eleni ^b   Giannarakis, Grigoris ^c   Arabatzis, Garyfallos ^b  

^a UNIVERSITY OF WESTERN MACEDONIA   (Greece)

^b DEMOCRITUS UNIVERSITY OF THRACE   (Greece)

^c UNIVERSITY OF THE AEGEAN   (Greece)

Author keywords

CSR firms; Environmental performance; Financial performance; GARCH model

Indexed keywords

CARBON DIOXIDE; CARBON EMISSION; ECONOMETRICS; EMPIRICAL ANALYSIS; ENVIRONMENTAL POLICY; INDUSTRIAL PERFORMANCE; MODELING; POLICY IMPLEMENTATION; REGRESSION ANALYSIS; SERVICE SECTOR;

EID: 84873090679     PISSN: 09644733     EISSN: 10990836     Source Type: Journal    
DOI: 10.1002/bse.1737     Document Type: Article

References (77)

1. Ahmad N, Wyckoff A. 2003. Carbon Dioxide Emissions Embodied in International Trade of Goods. OECD Science, Technology and Industry Working Papers, 2003/15. OECD Publishing: Paris.
2. Ahmed S. 2008. Aggregate economic variables and stock markets in India. International Research Journal of Finance and Economics 14: 141-164.
3. Al-Najjar B, Anfimiadou A. 2012. Environmental policies and firm value. Business Strategy and the Environment 21: 49-59. DOI: 10.1002/bse.713.
4. Al-Tuwaijri S, Christensen T, Hughes K. 2004. The relations among environmental disclosure, environmental performance, and economic performance: a simultaneous equations approach. Accounting, Organizations and Society 29(5/6): 447-471.
5. Arabatzis G, Polyzos S. 2008. Natural Resources, Environment and Development. Tziola: Thessaloniki (in Greek).
6. Arimura TH, Hibiki A, Katayama H. 2008. Is a voluntary approach an effective environmental policy instrument? A case for environmental management systems. Journal of Environmental Economics and Management 55: 281-295.
7. Arouri M, Nguyen DK. 2010. Oil prices, stock markets and portfolio investment: evidence from sector analysis in Europe over the last decade. Energy Policy 38(8): 4528-4539.
8. Arx UV, Ziegler A. 2008. The effects of CSR on stock performance: new evidence for USA and Europe. Economic Working Paper Series, Swiss Federal Institute of Technology: Zurich.
9. Bebbington J, Larrinaga-González C. 2008. Carbon trading: accounting and reporting issues. The European Accounting Review 17(4): 697-717.
10. Beghin CJ, Roland-Holst D, Van der Mensbrugghe D. 2005. In Trade and the Environment in General Equilibrium: Evidence from Developing Economies, Beghin J, Roland-Holst D, Van der Mensbrugghe D (eds). Springer.
11. Bewley K, Li Y. 2000. Disclosure of environmental information by Canadian manufacturing companies: a voluntary disclosure perspective. Advances in Environmental Accounting and Management 1: 201-226.
12. Bollerslev T. 1986. Generalized autoregressive conditional heteroskedasticity. Journal of Econometrics 31: 307-327.
13. Bollerslev T. 1987. A conditionally heteroskedastic time series model for speculative prices and rates of return. The Review of Economics and Statistics 69(3): 542-547.
14. Borland H, Paliwoda S. 2011. Marketing responsibility in an era of economic and climactic challenge. Marketing Intelligence and Planning 29(1): 49-62.
15. Brzobohaty T, Jansky P. 2010. The case of the Czech Republic. Transition Studies Review 17: 725-736.
16. Chen NF, Roll R, Ross SA. 1986. Economic forces and the stock market. Journal of Business 59(3): 383-403.
17. Claver-Cortésa E, Molina-Azorína JF, Dolores JP-M, López-Gameroa M. 2007. Environmental strategies and their impact on hotel performance. Journal of Sustainable Tourism 15(6): 663-679. DOI: 10.2167/jost640.0.
18. Cormier D, Magnan M. 2007. The revisited contribution of environmental reporting to investors' valuation of a firm's earnings: an international perspective. Ecological Economics 62: 613-626.
19. Çukur S, Günsel N. 2007. The effects of macroeconomic factors on the London stock returns: a sectoral approach. International Research Journal of Finance and Economics 10: 2-13.
20. Dam L. 2006. Corporate Social Responsibility in a General Equilibrium Stock Market Model: Solving the Financial Performance Puzzle. CCSO Working Paper Series, 200603. University of Groningen: Groningen.
21. Darnall N, Henriques I, Sadorsky P. 2009. Adopting proactive environmental strategy: the influence of stakeholders and firm size. Journal of Management Studies.
22. Delmas M. 2001. Stakeholders and competitive advantage: the case of ISO 14001. Productions and Operations Management 10: 343-358.
23. Dow Jones Sustainability Index (DJSI). 2011a. Dow Jones Sustainability World Index - Guide Book, Version 11.5. http://www.sustainabilityindexes.com/djsi_pdf/publications/Guidebooks/DJSI_World_Guidebook_11%206_final.pdf.
24. Dow Jones Sustainability Index (DJSI). 2011b. DJSI Annual Review 2010.
25. EIRIS. 2011. Climate Change Tracker 2011: Cool Brands versus Hot Brands? http://www.eiris.org/files/research20publications/ClimateChangeTracker2011.pdf.
26. Elsayed K, Paton D. 2009. The impact of financial performance on environmental policy: does firm life cycle matter? Business Strategy and the Environment 18: 397-413. DOI: 10.1002/bse.608.
27. Engle RF. 1982. Autoregressive conditional heteroskedasticity with estimates of the variance of U.K. inflation. Econometrica 50: 987-1008.
28. Etzion D. 2007. Research on organizations and the natural environment, 1992-present: a review. Journal of Management 33(4): 637-664.
29. Fayers C. 1999. Environment and investment: the role of personal investment choice in creating sustainability. Sustainable Development 7: 64-76.
30. Fei L, Dong S, Xue L, Liang Q, Yang W. 2011. Energy consumption-economic growth relationship and carbon dioxide emissions in China. Energy Policy 39(2): 568-574.
31. First I, Khetriwal D. 2010. Exploring the relationship between environmental orientation and brand value: is there fire or only smoke? Business Strategy and the Environment 19(2): 90-103.
32. Flannery MJ, Protopapadakis AA. 2002. Macroeconomic factors do influence aggregate stock returns. Review of Financial Studies 15: 751-782.
33. 2 emissions in a small open economy. Ecological Economics 45: 133-148.
34. Galbreth C. 2011. To what extent is business responding to climate change? evidence from a global wine producer. Journal of business ethics 104(3): 421-432. DOI: 10.1007/s10551-011-0919-5.
35. Gay DR. 2008. Effect of macroeconomic variables on stock market returns for four emerging economies: Brazil, Russia, India, and China. International Business and Economics Research Journal 7(3): 1-8.
36. Haigh M, Hazelton J. 2004. Financial markets: a tool for social responsibility? Journal of Business Ethics 52(1): 59-71. DOI: 10.1023/B:BUSI.0000033107.22587.0b.
37. Hart SL, Ahuja G. 1996. Does it pay to be green? An empirical examination of the relationship between pollution prevention and firm performance. Business Strategy and the Environment 5: 30-37.
38. Henriques I, Sadorsky P. 1996. The determinants of an environmentally responsive firm: an empirical approach. Journal of Environmental Economics and Management 30: 381-395.
39. Hopwood AG. 2009. Accounting and the environment. Accounting, Organizations and Society 34(3/4): 433-439.
40. Klassen RD, McLaughlin CP. 1996. The impact of environmental management on firm performance. Management Science 42(8): 1199-1214.
41. Lash J, Wellington F. 2007. Competitive advantage on a warming planet. Harvard Business Review 85(3): 95-102.
42. Lee S.-Y. 2012. Corporate carbon strategies in responding to climate change. Bus. Strat. Env 21: 33-48. DOI: 10.1002/bse.711.
43. Li Y, Richardson G, Thornton D. 1997. Corporate disclosure of environmental liability information theory and evidence. Contemporary Accounting Research 14(3): 435-474.
44. López MV, Garcia A, Rodriguez L. 2007. Sustainable development and corporate performance: a study based on the dow jones sustainability index. Journal of Business Ethics 75(3): 285-300. DOI: 10.1007/s10551-006-9253-8.
45. McLachlan J, Gardner J. 2004. A comparison of socially responsible and conventional investors. Journal of Business Ethics 52: 11-25.
46. Molina-Azorin J, Claver-Cortes E, Lopez-Gamero M, Tari J. 2009. Green management and financial performance: a literature review. Management Decision 47(7): 1080-1100.
47. 2 emissions in the European Union. Environmental and Resource Economics 19: 165-172.
48. Nakao Y, Amano A, Matsumura K, Genba K, Nakano M. 2007. Relationship between environmental performance and financial performance: an empirical analysis of japanese corporations. Business Strategy and the Environment 16: 106-118. DOI: 10.1002/bse.476.
49. Nasseh A, Strauss J. 2000. Stock prices and domestic and international macroeconomic activity: a cointegration approach. The Quarterly Review of Economics and Finance 40: 229-245.
50. Nehrt C. 1996. Timing and intensity effects of environmental investments. Strategic Management Journal 17(7): 535-547.
51. Nelson DB. 1991. Conditional heteroskedasticity in asset returns: a new approach. Econometrica 59: 347-370.
52. Newell R. 2010. The role of markets and policies in delivering innovation for climate change mitigation. Oxford Review of Economic Policy 26(2): 253-269.
53. Nikolaou IE, Evangelinos KI, Fihlo W. 2010. Intellectual property and environmental innovation: an explanation using the institutional and resource-based theories. International Journal of Foresight and Innovation Policy 6(4): 268-281. DOI: 10.1504/IJFIP.2010.037472.
54. Nishitani K, Kokubu K. 2011. Why does the reduction of greenhouse gas emissions enhance firm value? The case of Japanese manufacturing firms. Business Strategy and the Environment. DOI: 10.1002/bse.734.
55. OECD. 2010. Emissions of carbon dioxide. In OECD, OECD Factbook 2010: Economic, Environmental and Social Statistics. OECD Publishing. DOI: 10.1787/factbook-2010-63-en.
56. Orlitzky M, Schmidt MF, Rynes S. 2003. Corporate social and financial performance: a meta-analysis. Organization Studies 24(3): 403-441.
57. Papaspyropoulos K. 2010. Environmental Cost Accounting at Organizational Level: the Case of the Hunting Federation of Macedonia and Thrace, Ph.D. thesis, Faculty of Forestry and Natural Environment, Department of Planning and Development of Natural Resources, Thessaloniki (in Greek).
58. Pinkse J, Kolk A. 2010. Challenges and trade-offs in corporate innovation for climate change. Business Strategy and the Environment 19(4): 261-272. DOI: 10.1002/bse.677.
59. Renneboog L, Horst JT, Zhang C. 2008. The price of ethics and stakeholder governance: The performance of socially responsible mutual funds. Journal of Corporate Finance 14(3): 302-322.
60. 2 emissions and oil prices in the G7 countries. Energy Economics 31(3): 456-462.
61. SAM. 2010. The Sustainability Yearbook 2010. http://www.sam-group.com/images/sam-yearbook-2012-final_tcm794-328902.pdf.
62. Samitas A, Kenourgios D. 2007. Macroeconomic factors' influence on 'new' European countries' stock returns: the case of four transition economies. International Journal of Financial Services Management 2(1/2): 34-49.
63. Sarkis J, Torreb PG, Adenso-Diaz B. 2010. Stakeholder pressure and the adoption of environmental practices: the mediating effect of training. Journal of Operations Management 28(2): 163-176. doi.org/10.1016/j.jom.2009.10.001.
64. Schwartz MS, Carroll AB. 2003. Corporate social responsibility: a three-domain approach. Business Ethics Quarterly 13(4): 503-530.
65. Scholtens B. 2008. A note on the interaction between corporate social responsibility and financial performance. Ecological Economics 68(1/2): 46-55.
66. Seetharaman A, Mohamed I, Saravanan AS. 2007. Environmental accounting as a tool for environmental management system. Journal of Applied Science and Environmental Management 11(2): 137-145.
67. Sharma S, Henriques I. 2005. Stakeholder influences on sustainability practices in the Canadian forest products industry. Strategic Management Journal 26: 159-180.
68. Social Investment Forum. 2006. 2005 report on socially responsible investing trends in the United States: 10-year review. Retrieved June 14, 2007, from http://www.socialinvest.org/areas/research/trends/SRI_Trends_Report_2005.pdf.
69. Soytas U, Sari R. 2007. Energy consumption, economic growth, and carbon emissions: challenges faced by an EU candidate member. Ecological Economics 62: 482-489.
70. Sparkes R. 2002. Socially Responsible Investment: A Global Revolution. Wiley: Chichester.
71. Stanwick P, Stanwick S. 1998. The relationship between corporate social performance, and organizational size, financial performance, and environmental performance: an empirical examination. Journal of Business Ethics 17(2): 195-204.
72. Tol RSJ. 2005. The marginal damage costs of carbon dioxide emissions: an assessment of the uncertainties. Energy Policy 33: 2064-2074.
73. Wagner M, Van Phu N, Azomahou T, Wehrmeyer W. 2002. The relationship between the environmental and economic performance of firms: an empirical analysis of the European paper industry. Corporate Social Responsibility and Environmental Management 9(3): 133-146.
74. Wagner M, Wehrmeyer W. 2002. The relationship of environmental and economic performance at the firm level: a review of empirical studies in Europe and methodological comments. European Environment 12: 149-159.
75. Wheeler D, Elkington J. 2001. The end of the corporate environmental report? Or the advent of cybernetic sustainability reporting and communication. Business Strategy and the Environment 10(1): 1-14. DOI: 10.1002/1099-836(200101/02)10:1<1::AID-BSE274>3.0.CO;2-0.
76. Yamaguchi K. 2008. Reexamination of stock price reaction to environmental performance: A GARCH application. Ecological Economics 68(1-2): 345-352. http://dx.doi.org/10.1016/j.ecolecon.2008.04.004.
77. Ziegler A, Schröder M, Rennings K. 2007. The effect of environmental and social performance on the stock performance of European corporations. Environmental and Resource Economics 37: 661-680.