An Analysis of Carbon-Reduction Pledges of US Oil and Gas Companies

• 成果类型: Article
• 署名作者: Desai, Hemang; Lam, Pauline; Li, Bin; Rajgopal, Shiva
• 署名单位: Southern Methodist University; New York University; University of Houston System; University of Houston; Columbia University
• 刊物名称: MANAGEMENT SCIENCE
• ISSN/ISSBN: 0025-1909
• DOI: 10.1287/mnsc.2023.4765
• 发表日期: 2023
• 页码: 3748-3758
• 关键词: net-zero pledges; carbon emissions; E&P firms; Engine No; 1; determinants; stock reaction

摘要

We study carbon-reduction pledges of publicly traded U.S. oil exploration and production (E&P) companies. Of the 69 firms in the sample, 18 have committed to net-zero carbon targets, 14 have announced significant emissions cuts, whereas the remaining 37 firms have not announced any formal commitment to reduce emissions. We find that a firm's energy production and ownership by BlackRock is positively associated with its decision to announce a net-zero pledge or significant emission cuts. E&P firms are likely to announce such commitments after Engine No. 1 proposed its slate of directors for Exxon's board. The stock market reacts more negatively to net-zero pledges relative to emission-reduction pledges on average. However, the market reaction is related to the quality and credibility of these pledges. In particular, we find that the negative market reaction to net-zero pledges is mainly driven by firms with post-2030 target years relative to firms that commit to achieving net zero by 2030. We also find that the market reacts more negatively to net-zero pledges when the firm does not show the strength of its commitment via the presence of a boardlevel committee to monitor the company's progress toward its emission goals or when the top management's pay is not linked to specific emission reduction goals.