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Driving businesses towards a better climate: Macro and micro mechanisms to protect the planet

Lookup NU author(s): Professor Habiba Al-ShaerORCiD

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This work is licensed under a Creative Commons Attribution 4.0 International License (CC BY 4.0).


Abstract

This study examines whether corporate commitment to climate change is driven by country-level factors related to cultural values and the legal system of a country. We also investigate the impact of corporate governance strength on climate change commitment and the extent to which there are moderating effects between corporate governance and cultural and legal system influences. We use a large dataset of 21,564 firm-year observations of companies operating in the US, UK, and China for the period 2013 to 2020 and develop a unique measure for climate change commitment using different proxies for measuring climate change practices. We find variations in climate change commitment among the three countries and that cultural values and legal systems affect corporate commitment to climate change. Companies located in a socially oriented society, which are transparent and characterized by long-term orientation, are more strongly involved in climate change actions. The strength of corporate governance increases corporate commitment to climate change. Corporate governance also moderates some of the detrimental cultural influences on climate change commitment. These findings have implications for managers as they reveal that macro-level factors affect behaviour, and that corporate governance can help to moderate these factors.


Publication metadata

Author(s): Al-Shaer H, Albitar K, Liu YS

Publication type: Article

Publication status: Published

Journal: Business Strategy and the Environment

Year: 2024

Volume: 33

Issue: 3

Pages: 1810-1833

Print publication date: 01/03/2024

Online publication date: 20/09/2023

Acceptance date: 06/09/2023

Date deposited: 06/09/2023

ISSN (print): 0964-4733

ISSN (electronic): 1099-0836

Publisher: John Wiley & Sons Ltd

URL: https://doi.org/10.1002/bse.3575

DOI: 10.1002/bse.3575

Data Access Statement: Data are available from the authors upon reasonable request.


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