Are pollution control bonds the solution for energy firms under the magnifying glass?

Ines Bargaoui, Imen Khanchel () and Naima Lassoued ()
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Ines Bargaoui: Manouba University
Imen Khanchel: Manouba University
Naima Lassoued: Manouba University

Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, 2025, vol. 27, issue 6, No 80, 14343-14364

Abstract: Abstract This study examines the effect of pollution control bonds on energy firms’ financial and environmental performance. A linear regression method was used for a sample of 221 U.S. energy firms observed from 2011 to 2020. The results indicate significant positive relationships between pollution control bonds and firm performance. Our results are robust to crisis effect and to alternative measures of firm performance and pollution control bonds. This study investigates the impact of pollution control bonds (PCBs) on the financial performance and environmental innovation of energy utility firms. Using a linear regression method, we analyzed a sample of 221 U.S. energy utility firms spanning from 2011 to 2020. The findings reveal significant positive effects of PCB issuance on both firm performance and environmental innovation. These results remain robust when considering crisis effects and alternative measures of both firm performance and environmental innovation. Notably, while existing literature has explored the outcomes of green financing, the specific benefits of PCBs have not been previously examined. The outcomes of this study hold valuable insights for regulators, investors, and policymakers aiming to advance the use of PCBs.

Keywords: Pollution control bonds; Environmental innovation; Financial performance (search for similar items in EconPapers)
Date: 2025
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DOI: 10.1007/s10668-023-04441-0

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