Corporate Governance and Green Innovations
Mario Daniele Amore
INSEAD - Economics and Political Sciences
February 19, 2014
INSEAD Working Paper No. 2014/35/EPS
We present evidence of corporate governance effects on firms’ environmental performance. Using changes in takeover legislation as exogenous variations in corporate governance quality, we show that worse-governed firms generate fewer green patents relative to all their innovations. This effect is greater for firms with a smaller share of institutional ownership, with a smaller stock of green patents, and operating in states with lower pollution abatement costs and in industries less dependent on energy inputs. Our results suggest that worse-governed managers avoid complex projects that would entail major changes in the organization and composition of the employment.
Number of Pages in PDF File: 40
Keywords: corporate governance, environment, patents
JEL Classification: G34, O31, Q20working papers series
Date posted: February 13, 2013 ; Last revised: July 18, 2014
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