Does environmental lobbying create firm value?

Using data that link firm-level lobbying to environment-related congressional bills, we find that lobbying firms experience significantly less negative stock price reactions upon bill passage compared to their non-lobbying peers. These effects are stronger for major and closely contested legislation and during Democratic administration. While both green and brown firms lobby substantially, brown firms gain significantly more from lobbying. We also find that bills lobbied more heavily by brown firms are less likely to pass. Finally, emissions rise for brown firms that lobby but decline for green lobbying firms. Together, these findings reveal distinct patterns across interest groups in lobbying, which further interacts with legislative outcomes and the policy effectiveness.