Title: The business and environmental impacts of the Canadian Mandatory Greenhouse Gas Reporting Program

Authors: Keith Brouhle; Donna Ramirez Harrington

Addresses: Department of Economics, Grinnell College, 1226 Park Street, Grinnell, IA50112, USA ' Department of Economics, University of Vermont, 233 Old Mill Building, 94 University Place, Burlington, VT 05405, USA

Abstract: This research investigates the impact of Canada's mandatory greenhouse gas reporting program on firms' share price and future environmental performance. First, we examine whether stock market prices are affected by investors' response to publicly disclosed greenhouse gas (GHG) information. Second, we test whether abnormal stock price changes lead to lower GHG emissions. We find that investors punish firms whose emissions intensity increased but their losses are mitigated with previous voluntary GHG reporting. Observed improvements in environmental performance were small and limited to the dirtiest firms. These findings imply a narrow scope for information provision as a GHG mitigation policy tool.

Keywords: information disclosure; event study; climate change; GHG emissions.

DOI: 10.1504/IJEBR.2023.127276

International Journal of Economics and Business Research, 2023 Vol.25 No.1, pp.113 - 136

Accepted: 01 Apr 2021
Published online: 30 Nov 2022 *

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