Corporate Carbon Emissions and Market Valuation of Organic and Inorganic Investments

Date

2022-10-14

Advisors

Journal Title

Journal ISSN

ISSN

Volume Title

Publisher

Elsevier

Type

Article

Peer reviewed

Yes

Abstract

We empirically examine the impact of a firm’s carbon emissions level on the market valuation of organic and inorganic investments. We document that the market reacts negatively to corporate investment announcements by companies with high carbon emissions levels. Further analysis indicates that the discount on market valuation is more pronounced for the set of organic investments, within which only asset acquisitions and product launches are negatively affected by the high carbon emissions level at the announcement.

Description

open access article

Keywords

Carbon Emissions, Market Valuation, Organic Investments Announcements, Inorganic Investment announcements

Citation

Adamolekun, G. et al (2022) Corporate Carbon Emissions and Market Valuation of Organic and Inorganic Investments. Economics Letters, 221, 110887

Rights

Research Institute

Finance and Banking Research Group (FiBRe)