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Carbon Emissions and Firm Performance: Evidence from Financial and Non-Financial Firms from Selected Emerging Economies

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  • Mohammad Dulal Miah

    (Department of Economics and Finance, University of Nizwa, Nizwa 616, Oman)

  • Rashedul Hasan

    (Department of Economics, Finance, and Accounting, Coventry University, Coventry CV1 5ED, UK)

  • Mohammed Usman

    (Department of Management, University of Nizwa, Nizwa 616, Oman)

Abstract

This paper examines the effects of carbon emissions on the accounting and market-based performance of financial and non-financial firms in emerging economies. Data for 104 financial and 328 non-financial firms constituting 2591 observations operating in 22 emerging economies were collected from the Datastream database for the period 2011–2020. We applied OLS and 2SLS regression techniques to analyze the data. Results show that financial firms emit less carbon than their non-financial counterparts. The results further show that carbon emissions reduce firms’ return on equity, Tobin’s Q, Z-score, and credit rating. Our findings remain robust in different estimation techniques and alternative proxies of performance. Our results have some important policy implications for emerging economies.

Suggested Citation

  • Mohammad Dulal Miah & Rashedul Hasan & Mohammed Usman, 2021. "Carbon Emissions and Firm Performance: Evidence from Financial and Non-Financial Firms from Selected Emerging Economies," Sustainability, MDPI, vol. 13(23), pages 1-19, November.
    • Handle: RePEc:gam:jsusta:v:13:y:2021:i:23:p:13281-:d:692071
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    Cited by:

    1. Erli Dan & Jianfei Shen & Xinyuan Zheng & Peng Liu & Ludan Zhang & Feiyu Chen, 2023. "Asset Structure, Asset Utilization Efficiency, and Carbon Emission Performance: Evidence from Panel Data of China’s Low-Carbon Industry," Sustainability, MDPI, vol. 15(7), pages 1-20, April.
    2. Rashedul Hasan & Mohammad Dulal Miah & M. Kabir Hassan, 2022. "The nexus between environmental and financial performance: Evidence from gulf cooperative council banks," Business Strategy and the Environment, Wiley Blackwell, vol. 31(7), pages 2882-2907, November.

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