In this study, we investigate whether firms’ eco-friendly strategies affect their value. For the analysis, we study 210 firms in the Republic of Korea. These firms were listed on the Korea Composite Stock Price Index and the Korea Securities Dealers Automated Quotations during 2017–2021. We measure the dependent variable by return on assets, return on equity, and Tobin’s Q as firm value and use the ordinary least square estimation. The results show that firms’ eco-friendly strategies have a positive effect on firm value. Additionally, we examine the effect of eco-friendly strategies on performance by industry and by duration. In the nonservice industry, there is a positive effect of environmental strategy on firm value for a 5-year window, but not for a 3-year window. In the service industry, in contrast, eco-friendly strategies have no effect on firm value for the 5-year window but have positive effects for the 3-year window. In the robustness check, for the endogeneity issue, we perform a two-stage least squares analysis. This study demonstrates that environmental actions are reflected in firm value and that the performance varies by industry. Thus, these results provide critical insights for managers and policy makers who consider the environmental issues of firms.

This study investigated whether firms' knowledge assets and path dependence in their innovations affect firm value. For the analysis, I used 37 firms in the semiconductor industry in Korea. These firms were listed on the Korea Stock Exchange and the Korea Securities Dealers Association Automated Quotation as of 2010 and through 2015. The dependent variable was measured by return on assets as firm value, and the ordinary least squares estimation was used. The results showed that a firm's knowledge assets have a positive effect on firm value. In addition, when a firm creates new knowledge, if the firm follows path dependence by using its own knowledge, it has a positive effect on firm value. By contrast, when a firm conducts innovations using knowledge created by other firms, it has no effect on the value of the firm. Additionally, I found that technological innovation based on knowledge assets and path dependence has a positive effect on firm value in the short term but has no effect in the medium term. Thus, firms need to continue their innovation to maintain their competitive advantage and to use their existing knowledge in innovation in order to have high performance.

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