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Does firm-level carbon assurance matter for trade credit?

Author

Listed:
  • Safiullah, Md
  • Nguyen, Linh Thi My

Abstract

We are among the first to examine the influence of carbon assurance on trade credit. Drawing on a sample of publicly listed U.S. firms, we document that firms with high carbon assurance obtain more trade credit from their suppliers. Our channel analysis tests show that high carbon assurance translates into higher trade credit by reducing risk and information asymmetry. Our results are robust with alternative model specifications, trade credit and carbon assurance measures, 2SLS IV analysis, PSM estimates, and Heckman-two stage approach to address possible endogeneity.

Suggested Citation

  • Safiullah, Md & Nguyen, Linh Thi My, 2024. "Does firm-level carbon assurance matter for trade credit?," Finance Research Letters, Elsevier, vol. 68(C).
    • Handle: RePEc:eee:finlet:v:68:y:2024:i:c:s1544612324010316
    DOI: 10.1016/j.frl.2024.106001
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    References listed on IDEAS

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    More about this item

    Keywords

    Carbon assurance; Trade credit; Financial risk; Information asymmetry;
    All these keywords.

    JEL classification:

    • G30 - Financial Economics - - Corporate Finance and Governance - - - General
    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
    • M42 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Accounting - - - Auditing

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