The Impact of Climate Action on the Financial Performance of Food, Grocery, and Supermarket Retailers in the UK

Tolu Olarewaju (), Samir Dani, Collins Obeng-Fosu, Tayo Olarewaju and Abdul Jabbar
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Tolu Olarewaju: Keele Business School, Keele University, Keele, Newcastle-under-Lyme ST5 5BG, UK
Samir Dani: Keele Business School, Keele University, Keele, Newcastle-under-Lyme ST5 5BG, UK
Collins Obeng-Fosu: Keele Business School, Keele University, Keele, Newcastle-under-Lyme ST5 5BG, UK
Tayo Olarewaju: Peter A. Allard School of Law, The University of British Columbia, Allard Hall, 1822 E Mall, Vancouver, BC V6T 1Z1, Canada
Abdul Jabbar: Leicester School of Business, University of Leicester, Brookfield, Leicester LE2 1RQ, UK

Sustainability, 2024, vol. 16, issue 5, 1-23

Abstract: We examined the impact of climate action on the financial performance of eleven food, grocery, and supermarket retailers listed on the London Stock Exchange from 2013 to 2022. Our findings reveal a positive association between the climate mitigation efforts of these businesses and financial performance, particularly in terms of returns on assets (ROA). Through Ordinary Least Squares estimation, we identified that climate action practices such as renewable energy usage, waste reduction, adoption of energy-efficient technologies, eco-friendly packaging, and optimized transportation are significantly associated with the ROA of UK-based food, grocery, and supermarket retailers. This study is significant as these retailers often have extensive operations and supply chains that contribute to greenhouse gas emissions. It demonstrates that engaging in climate mitigation measures can still lead to a positive ROA.

Keywords: climate action; financial performance; sustainability; climate change; enterprises; food grocery; retail (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2024
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