Climate policy uncertainty, corporate social responsibility and corporate investments of the energy firms

Chiu-Lan Chang, Jiahui Zhang and Yu-En Lin

Energy Economics, 2024, vol. 140, issue C

Abstract: Climate policy uncertainty (CPU), driven by the need to address climate extremes and environmental degradation, significantly impacts the strategic corporate investments (CI) of energy firms. This study examines the influence of CPU on CI within the energy sector, with a particular focus on the moderating role of corporate social responsibility (CSR). Utilizing an empirical approach and a dataset of U.S. energy firms, the research reveals that CPU negatively affects CI, even after controlling for firm-specific factors such as size, financial leverage, and profitability. The study also uncovers a complex relationship between CSR and CI under conditions of CPU. While CSR is beneficial for firms' long-term growth and financial health by promoting sustainable practices, it can also intensify the negative impact of CPU on CI for firms with limited financial resources.

Keywords: Climate policy uncertainty; Corporate social responsibility; Corporate investments; Energy firms (search for similar items in EconPapers)
Date: 2024
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Persistent link: https://EconPapers.repec.org/RePEc:eee:eneeco:v:140:y:2024:i:c:s0140988324006765

DOI: 10.1016/j.eneco.2024.107968

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