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Corporate carbon reduction pledges: An effective tool to mitigate climate change?

Author

Listed:
  • Comello, Stephen
  • Reichelstein, Julia
  • Reichelstein, Stefan

Abstract

In the intensifying public debate about limiting the harmful effects of climate change, many global corporations have recently articulated so-called 'net-zero' goals for reducing and ultimately eliminating their own greenhouse gas emissions. We first examine the details ofthe carbon reduction goals articulated by seven large firms in different industries. The individual reduction goals are shown to vary substantially in terms of specificity and scope, largely due to variations in the measurement of carbon footprints. Particular sources of variation arise from how 'gross emissions' are determined and from firms' willingness to recognize carbon credits that offset their own emissions.

Suggested Citation

  • Comello, Stephen & Reichelstein, Julia & Reichelstein, Stefan, 2021. "Corporate carbon reduction pledges: An effective tool to mitigate climate change?," ZEW Discussion Papers 21-052, ZEW - Leibniz Centre for European Economic Research.
    • Handle: RePEc:zbw:zewdip:21052
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    Citations

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    Cited by:

    1. Gregory Trencher & Mathieu Blondeel & Jusen Asuka, 2023. "Do all roads lead to Paris?," Climatic Change, Springer, vol. 176(7), pages 1-33, July.
    2. Zola Berger‐Schmitz & Douglas George & Cameron Hindal & Richard Perkins & Maria Travaille, 2023. "What explains firms' net zero adoption, strategy and response?," Business Strategy and the Environment, Wiley Blackwell, vol. 32(8), pages 5583-5601, December.
    3. Paolo Angelini, 2024. "Portfolio decarbonisation strategies: questions and suggestions," Questioni di Economia e Finanza (Occasional Papers) 840, Bank of Italy, Economic Research and International Relations Area.
    4. Hechelmann, Ron-Hendrik & Paris, Aaron & Buchenau, Nadja & Ebersold, Felix, 2023. "Decarbonisation strategies for manufacturing: A technical and economic comparison," Renewable and Sustainable Energy Reviews, Elsevier, vol. 188(C).
    5. Zhang, Zehua & Zhao, Ran, 2022. "Carbon emission and credit default swaps," Finance Research Letters, Elsevier, vol. 50(C).
    6. Shira Cohen & Igor Kadach & Gaizka Ormazabal & Stefan Reichelstein, 2023. "Executive Compensation Tied to ESG Performance: International Evidence," Journal of Accounting Research, Wiley Blackwell, vol. 61(3), pages 805-853, June.
    7. Glenk, Gunther & Reichelstein, Stefan, 2021. "Intermittent versus dispatchable power sources: An integrated competitive assessment," ZEW Discussion Papers 21-065, ZEW - Leibniz Centre for European Economic Research.
    8. Comello, Stephen & Reichelstein, Julia & Reichelstein, Stefan, 2023. "Corporate carbon reporting: Improving transparency and accountability," ZEW Discussion Papers 23-026, ZEW - Leibniz Centre for European Economic Research.
    9. Yang Liu & Ling Tang, 2024. "Environmental Penalties, Internal and External Governance, and Green Innovation: Does the Deterrence Effect Work?," Sustainability, MDPI, vol. 16(16), pages 1-17, August.
    10. Hemang Desai & Pauline Lam & Bin Li & Shiva Rajgopal, 2023. "An Analysis of Carbon-Reduction Pledges of U.S. Oil and Gas Companies," Management Science, INFORMS, vol. 69(6), pages 3748-3758, June.

    More about this item

    Keywords

    Carbon Emissions; corporate reporting; net-zero goals; carbon offsets;
    All these keywords.

    JEL classification:

    • Q28 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Renewable Resources and Conservation - - - Government Policy
    • Q40 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Energy - - - General
    • M41 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - Accounting
    • M48 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - Government Policy and Regulation

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