 Ownership structure and carbon emissions reductionYin-Hua Yeh and Chen-Chieh Liao Pacific-Basin Finance Journal, 2024, vol. 83, issue C Abstract: This study investigates the relationship between ownership structure and reductions in carbon emissions. The Taiwan government passed the Greenhouse Gas Reduction and Management Act in July 2015, requiring carbon-intensive firms to disclose their annual direct and indirect carbon emissions. To mitigate endogeneity concerns, we use Taiwan's inheritance and estate tax reform in 2017 as an exogenous shock to a firm's ownership structure to conduct two-stage least squares analyses. We find that the higher the controlling shareholder's cash flow rights, the more a firm's direct carbon emissions will be reduced, consistent with the positive incentive effect, long-term decision-making, and socio-emotional wealth argument. Furthermore, we also find that when the controlling shareholder's board seat ratio highly deviates from their cash flow rights, the controlling shareholder is less concerned about carbon risk and even increases direct carbon emissions, consistent with the negative entrenchment effect. Keywords: Ownership structure; Carbon emissions; ESG; Corporate governance (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:pacfin:v:83:y:2024:i:c:s0927538x24000131 DOI: 10.1016/j.pacfin.2024.102262 Access Statistics for this article Pacific-Basin Finance Journal is currently edited by K. Chan and S. Ghon Rhee More articles in Pacific-Basin Finance Journal from Elsevier |
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