Legitimacy or efficiency? Carbon emissions transfers under the pressure of environmental law enforcement

Pan, Lipeng; Han, Wenqi; Li, Yongqing; Wu, Hanxu

doi:10.1016/j.jclepro.2022.132766

Cited by 13 publications

(19 citation statements)

References 62 publications

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“…The excessive release of greenhouse gases has led to a continuous rise in global temperatures, which, in turn, has given rise to significant ecological and environmental problems (Pan et al , 2022). Carbon emissions are widely acknowledged as a key factor contributing to the greenhouse effect and global warming (Dou et al , 2021; Zhong et al , 2021).…”

Section: Literature Review and Hypothesis Developmentmentioning

confidence: 99%

“…However, it is evident that despite these plans, the world is still struggling to curb global warming (WMO, 2022). One factor that has been identified as contributing to this struggle is carbon transfer (Pan et al , 2022; Peters et al , 2011; Sun et al , 2016). The current prevalence of international trade has resulted in a complex network of interdependence and geographic separation of commodity production and consumption (Fang et al , 2021; Wang et al , 2021a, 2021b; Xie et al , 2023).…”

Section: Literature Review and Hypothesis Developmentmentioning

confidence: 99%

“…However, global carbon emissions continue to rise, and the World Meteorological Organisation (WMO) reports that global warming is far from under control (WMO, 2019). Carbon emissions transfer, also known as carbon leakage in the supply chain, is one of the main causes for this situation (Cui and Chen, 2023; Pan et al , 2022; Peters et al , 2011; Sun et al , 2016).…”

Section: Introductionmentioning

confidence: 99%

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Carbon management and the global value chain: have carbon emissions been reduced?

Pan,

Li,

et al. 2024

SAMPJ

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Purpose This paper aims to explore the pathways of carbon transfer in 200 US corporations along with the motivations that drive such transfers. The particular focus is on each firm’s embeddedness in the global value chain (GVC) and the influence of environmental law, operational costs and corporate social responsibility (CSR). The insights gleaned bridge a gap in the literature surrounding GVCs and corporate carbon transfer. Design/methodology/approach The methodology comprised a two-step research approach. First, the authors used a two-sided fixed regression to analyse the relationship between each firm’s embeddedness in the GVC and its carbon transfers. The sample consisted of 217 US firms. Next, the authors examined the influence of environmental law, operational costs and CSR on carbon transfers using a quantitative comparison analysis. These results were interpreted through the theoretical frameworks of the GVC and legitimacy theory. Findings The empirical results indicate positive relationships between carbon transfers and GVC embeddedness in terms of both a firm’s position and its degree. From the quantitative comparison, the authors find that the pressure of environmental law and operational costs motivate these transfers through the value chain. Furthermore, CSR does not help to mitigate transfers. Practical implications The findings offer insights for policymakers, industry and academia to understand that, with globalised production and greater value creation, transferring carbon to different parts of the GVC – largely to developing countries – will only become more common. The underdeveloped nature of environmental technology in these countries means that global emissions will likely rise instead of fall, further exacerbating global warming. Transferring carbon is not conducive to a sustainable global economy. Hence, firms should be closely regulated and given economic incentives to reduce emissions, not simply shunt them off to the developing world. Social implications Carbon transfer is a major obstacle to effectively reducing carbon emissions. The responsibilities of carbon transfer via GVCs are difficult to define despite firms being a major consideration in such transfers. Understanding how and why corporations engage in carbon transfers can facilitate global cooperation among communities. This knowledge could pave the way to establishing a global carbon transfer monitoring network aimed at preventing corporate carbon transfer and, instead, encouraging emissions reduction. Originality/value This study extends the literature by investigating carbon transfers and the GVC at the firm level. The authors used two-step research approach including panel data and quantitative comparison analysis to address this important question. The authors are the primary study to explore the motivation and pathways by which firms transfer carbon through the GVC.

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Section: Literature Review and Hypothesis Developmentmentioning

confidence: 99%

Section: Literature Review and Hypothesis Developmentmentioning

confidence: 99%

Section: Introductionmentioning

confidence: 99%

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Carbon management and the global value chain: have carbon emissions been reduced?

Pan,

Li,

et al. 2024

SAMPJ

Self Cite

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“…Carbon disclosure thus represents an important means by which firms demonstrate their fulfillment of the expectations of society, hence legitimizing their environmental activities (Perera et al ., 2019). Legitimacy pressure is thus believed to be a key driver of corporate carbon disclosure in the legitimacy theory (Pan et al ., 2022).…”

Section: Theoretical Background and Conceptual Frameworkmentioning

confidence: 99%

“…First, low prices, factor market prices and environmental costs will stimulate firms to develop extensively, use tangible resources such as land intensively and consume a large number of natural resources, damaging the environment and releasing large amounts of greenhouse gases, along with having less motivation and pressure to invest in innovations, environmental protection equipment, green technology, green products and green processes. In this case, firms may know the significance of carbon emissions reduction, while they will not truly feel the pressure of the legality of the external environment because the operating efficiency of their firms will not be affected (Pan et al ., 2022). When there is no carbon reduction practice, firms have nothing to disclose, which is valuable to the public because the public wants to see whether there is an improvement in corporate carbon performance.…”

Section: Hypotheses Developmentmentioning

confidence: 99%

Who discloses carbon information? The joint role of ownership and factor market distortion

Chen

Zhu

Xiong

et al. 2023

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PurposeCorporations, as key contributors of greenhouse gas emissions, have been increasingly scrutinized by governments and stakeholders. Corporations have been asked to disclose their carbon-related information. This study investigates public corporate carbon disclosure, an imperative communication channel between firms.Design/methodology/approachThis study uses generalized estimation equation models with a longitudinal panel data of 311 listed firms in the China A-share stock index from 2010 to 2020. This study collected firm-level data from the Carbon Disclosure Project survey, the China Stock Market and Accounting Research, and the National Economic Research Institute of China. Stata was used as the primary statistic software in empirical analyses.FindingsThis study finds that compared to state-owned enterprises (SOEs), private firms are more willing to disclose carbon information under legitimate environmental pressure, and firms in highly distorted factor-markets are reluctant to disclose carbon information. This study finds that factor-distortion markets further moderate ownership and lead private firms in highly distorted factor-markets to behave like SOEs by significantly reducing their carbon disclosures.Originality/valueThis study intends to contribute to the corporate carbon disclosure literature by adding important institutional determinants to the conversation in the context of China.

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Government environmental concerns and corporate green innovation: Evidence from heavy‐polluting enterprises in China

Chen,

Zhu,

Ding

et al. 2023

Bus Strat Env

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The objective of this study is to examine the impact of government environmental concerns on green innovation and whether this has a “leverage effect” or a “crowding‐out effect.” This study employs a two‐way fixed‐effects model to conduct an empirical test using panel data from 2010 to 2020 on Chinese firms listed in heavy‐polluting industries. The results suggest that an increase in government environmental concerns can promote corporate green innovation. However, government environmental concerns primarily stimulate strategic innovation rather than substantive innovation. After a series of robustness and endogeneity tests, the conclusions of this paper still hold. Corporate green innovation induced by government environmental concerns is not the “leverage effect” superimposed on existing innovation activities but the “crowding‐out effect” of other technological innovation. The heterogeneity tests in this paper indicate that the impact is more pronounced for firms with poorer environmental conditions, stronger political connections, and richer executive backgrounds.

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Legitimacy or efficiency? Carbon emissions transfers under the pressure of environmental law enforcement

Cited by 13 publications

References 62 publications

Carbon management and the global value chain: have carbon emissions been reduced?

Carbon management and the global value chain: have carbon emissions been reduced?

Who discloses carbon information? The joint role of ownership and factor market distortion

Government environmental concerns and corporate green innovation: Evidence from heavy‐polluting enterprises in China

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