The Benefits of Being Greener: Unravelling the Association Between Carbon Performance and Market Value

Emmanuel A. Morrison, Emmanuel Adegbite, Musa Mangena, Danson Kimani and Douglas A. Adu

Business Strategy and the Environment, 2025, vol. 34, issue 4, 4928-4957

Abstract: This study examines the interrelations among pay incentives, board sustainability committee initiative, carbon performance and market value. Using data from listed firms in emerging economies, we find that pay incentives and board sustainability committee initiative increase the firms' process‐based carbon performance but have no similar effect on outcome‐based carbon performance. We detect that board sustainability committee initiative has a positive moderating effect on the association between pay incentives and outcome‐based carbon performance. We also find that higher level of process‐based carbon performance is associated with low market value, but outcome‐based carbon performance does not seem to impact on market value. Accordingly, two factors, namely, enhanced board sustainability committee initiatives and increased process‐based carbon performance, are found to be channels through which carbon performance affects market value. Our findings call for firms, practitioners and policymakers to design and implement effective board sustainability committee initiative and pay incentive mechanisms to improve actual carbon performance.

Date: 2025
References: Add references at CitEc
Citations:

Downloads: (external link)
https://doi.org/10.1002/bse.4224

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:bla:bstrat:v:34:y:2025:i:4:p:4928-4957

Ordering information: This journal article can be ordered from
http://onlinelibrary ... 1002/(ISSN)1099-0836

Access Statistics for this article

Business Strategy and the Environment is currently edited by Richard Welford

More articles in Business Strategy and the Environment from Wiley Blackwell
Bibliographic data for series maintained by Wiley Content Delivery ().