Carbon risk and technological mergers and acquisitions(M&A):The perspective of institutional pressures

Jinyu Chen, Yirui Fan, Yan Yang and Ying Tang

Energy Economics, 2025, vol. 143, issue C

Abstract: With the growing urgency of climate issues, this paper examines whether companies accelerate low-carbon transitions and manage rising carbon risk by technological mergers and acquisitions (M&A). This paper explores the effect of carbon risk on technological M&A from the perspective of institutional pressures, using data from listed companies over the period 2009 to 2020. Our research results indicate that high carbon emission firms are more likely to engage in technological M&A, and this holds consistently after various robustness checks. Cross-sectional analysis indicates that the impact of carbon risk on technological M&A activities is notably stronger in state-owned enterprises (SOEs) and companies with fewer financing constraints. Furthermore, normative pressure significantly strengthens the impact of carbon risk on technological M&A, while coercive and mimetic pressures weaken this effect. Our findings shed insight on the motivation of corporate technological M&A strategy from the perspective of carbon risk, and provide practical guidance to promote sustainable environmental development.

Keywords: Carbon risk; Technological M&A; Institutional pressure; M&A premium (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eee:eneeco:v:143:y:2025:i:c:s0140988325000362

DOI: 10.1016/j.eneco.2025.108213

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