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Eco-efficiency and financial performance in Latin American countries: An environmental intensity approach

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  • Rodríguez-García, Martha del Pilar
  • Galindo-Manrique, Alicia Fernanda
  • Cortez-Alejandro, Klender Aimer
  • Méndez-Sáenz, Alma Berenice

Abstract

This research contributes to the literature by empirically demonstrating the economic effect of listed companies’ eco-efficiency in Brazil, Chile, Colombia, and Mexico through an environmental intensity approach. We find evidence of a positive relationship between eco-efficiency and financial performance; that is, a lower CO2 emission-to-sales ratio increases Tobin’s q, with a stronger impact on those companies with the highest financial performance, mainly those in Brazil and Chile, with lower impacts in Colombia. On the other hand, Mexico shows no such relationship. These results can help investors understand the effect of eco-efficiency on Tobin's q not only at the median but also in the different quantiles. Moreover, our findings help fill the gap in the literature on eco-efficiency at the micro level in Latin American countries.

Suggested Citation

  • Rodríguez-García, Martha del Pilar & Galindo-Manrique, Alicia Fernanda & Cortez-Alejandro, Klender Aimer & Méndez-Sáenz, Alma Berenice, 2022. "Eco-efficiency and financial performance in Latin American countries: An environmental intensity approach," Research in International Business and Finance, Elsevier, vol. 59(C).
    • Handle: RePEc:eee:riibaf:v:59:y:2022:i:c:s0275531921001689
    DOI: 10.1016/j.ribaf.2021.101547
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    Cited by:

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    2. Weizhou Su & Nieping Wei & Zihan Yuan & Sidai Guo, 2023. "The Impact of Environmental Information Disclosure on the Efficiency of Enterprise Capital Allocation," Sustainability, MDPI, vol. 15(14), pages 1-19, July.
    3. Matheus Belucio & Giulio Guarini, 2023. "Analyzing the Influence of Philanthropy on Eco-Efficiency in 108 Countries," Sustainability, MDPI, vol. 15(2), pages 1-23, January.

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    More about this item

    Keywords

    CO2 emissions; Eco-efficiency; Emerging countries; Quantile regression; Tobin’s q;
    All these keywords.

    JEL classification:

    • G30 - Financial Economics - - Corporate Finance and Governance - - - General
    • M14 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - Corporate Culture; Diversity; Social Responsibility
    • Q51 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Valuation of Environmental Effects

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