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Carbon management accounting and financial performance: Evidence from the European Union emission trading system

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  • Yenny Naranjo Tuesta
  • Cristina Crespo Soler
  • Vicente Ripoll Feliu

Abstract

Companies are responding to the effects of climate change by reducing CO2 emissions as a way of managing stakeholder interests and complying with legal and regulatory requirements. In Europe, the emissions trading system is consolidated as a limiting market and control scheme to support business climate change management through a collaborative relationship between government and industry. This work focuses on the economic accounting field, analysing carbon management accounting and its impact on financial performance in scenarios attached to that trading system. The methodological approach used is quantitative, empirically testing the hypotheses through a multiple regression analysis with a sample of 350 European companies. The results attest to the importance of carbon management accounting (CMA) control and its effects on financial performance. Compared with European emission trading, the results failed to display significant differences in the relationship studied between those that make up this type of market and those that do not.

Suggested Citation

  • Yenny Naranjo Tuesta & Cristina Crespo Soler & Vicente Ripoll Feliu, 2021. "Carbon management accounting and financial performance: Evidence from the European Union emission trading system," Business Strategy and the Environment, Wiley Blackwell, vol. 30(2), pages 1270-1282, February.
    • Handle: RePEc:bla:bstrat:v:30:y:2021:i:2:p:1270-1282
    DOI: 10.1002/bse.2683
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    4. Siying Yang & Wenxuan Sun & Zhouyi Wu & Yang He, 2022. "Can the SO2 emission trading system promote urban emission reduction?," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 43(4), pages 963-974, June.
    5. Ebiyon Idundun & Andrew S. Hursthouse & Iain McLellan, 2021. "Carbon Management in UK Higher Education Institutions: An Overview," Sustainability, MDPI, vol. 13(19), pages 1-16, September.
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