A0735
Title: An anatomy of decarbonizing firms
Authors: Guillaume Coqueret - Emlyon Business School (France) [presenting]
Thomas Giroux - CREST (France)
Borui Qiu - EMLYON Business School (France)
Abstract: The purpose is to shed light on the drivers of decarbonization in the cross-section of global publicly-listed firms. Both panel models and feature importance from random forests show that the single best predictors of emission and intensity reduction are proxies of size, whether they are past capitalization, revenue, or emissions. It is found that many other factors influence this, including macroeconomic (country-specific) variables and prior financial decisions. The results indicate that the linear extrapolation method can be improved for the estimation of corporate greenhouse gas trajectories. Asset managers seeking net-zero targets can benefit from the higher accuracy of the approach. A causal analysis of the exogenous macroeconomic events that nudge companies to accelerate their decarbonization path is further conducted.
