62 Pages Posted: 1 May 2017 Last revised: 12 Sep 2017
Date Written: September 4, 2017
In a 2010 special report, The Economist called the resurgence of state-owned mega-enterprises, especially those in emerging economies, “Leviathan Inc,” and criticized their poor governance and low efficiency. We show that state-owned enterprises engage more in environmental issues and are more responsive to salient environmental events. The effect is more pronounced in energy firms located in emerging economies and countries with higher energy risks, and with direct ownership held by domestic government rather than sovereign wealth funds. Market value does not suffer from such engagement. These results suggest that “Leviathan Inc.” may be better positioned at dealing with environmental externalities.
Keywords: state ownership, environmental engagement, sustainability, ownership structure
JEL Classification: G32, H11, H41, Q56
Suggested Citation: Suggested Citation
Hsu, Po-Hsuan and Liang, Hao and Matos, Pedro P., Leviathan Inc. and Corporate Environmental Engagement (September 4, 2017). Darden Business School Working Paper No. 2960832; ECGI - Finance Working Paper No. 526/2017. Available at SSRN: https://ssrn.com/abstract=2960832 or http://dx.doi.org/10.2139/ssrn.2960832