The impact of corporate governance on carbon emissions

In this project, we will empirically examine how ownership form, through its effect on corporate governance, affects firm carbon dioxide (CO2) emissions abatement activities. We will use Swedish data from 1990-2018 as our experimental setting.

The two main novelties of our project is: i) that we exploit detailed micro level data on firm-level CO2 emissions from both industrial facilities and transport which we merge with unique data on ownership transitions, and ii) our focus on the conflict between profit maximization and climate change mitigation action using variation in corporate governance caused by ownership changes.

Our results will both have significant importance in shifting the research knowledge frontier forward as well as providing policy makers with a basis for how economic incentives can conflict or align with climate change mitigating policy efforts.

In order to evaluate the impact of ownership transitions we exploit the panel nature of our data and run difference-in-differences regressions where we compare firms with ownership changes to a control group of similar firms. We also exploit additional variation emanating from policy changes (e.g., carbon taxation) in our tests.

The project is organized around three different projects and is planned to run for four years where we plan to generate at least one top-level scientific publication per project. The members of the research group have extensive experience working with Swedish micro level data.