Carbon neutral announcements and Chinese stock market reaction: a supply chain network-based perspective
International Journal of Operations & Production Management
ISSN: 0144-3577
Article publication date: 5 September 2023
Issue publication date: 19 March 2024
Abstract
Purpose
This study aims to explore the impact of carbon neutral announcements on “stock market value” of publicly listed companies in China.
Design/methodology/approach
The event study approach is adopted. Market, market-adjusted, Carhart four-factor model and a cross-sectional regression model are employed to examine the impacts of carbon neutral announcements on “stock market value” of Chinese companies based on data from 188 carbon neutral announcements.
Findings
Carbon neutral announcements positively impact Chinese shareholder value. Carbon neutral announcements at the strategic level have a more positive and significant impact on Chinese stock market value. Innovative carbon neutral announcements do not significantly cause Chinese stock market reactions. Companies have more positive and significant stock market reactions when the companies make carbon neutral announcements that reflect high supply chain network resilience and heterogeneity and strong supply chain network relationships.
Practical implications
The findings uncover the business value of carbon neutral activities and provide operations managers in developing countries insights into how to improve enterprises' market value by actively implementing carbon neutral activities.
Originality/value
This paper is the first trial to apply an event study to examine the relationship between carbon neutral announcements and Chinese stock market value from the perspective of announcement level and type and supply chain networks. This paper introduces corporate reputation theory and enriches the application of corporate reputation theory in the field of low-carbon environmental protections and supply chains.
Keywords
Acknowledgements
This research is funded by Major Program of the National Social Science Foundation of China (No. 22&ZD139). The reviewers’ comments are also highly appreciated. The authors acknowledge Zhixuan Chen and Yongzheng Gao as the co-corresponding author for this paper.
Citation
Liu, W., Chen, Z., Choi, T.-M., Lee, P.T.-W., Chan, H.K. and Gao, Y. (2024), "Carbon neutral announcements and Chinese stock market reaction: a supply chain network-based perspective", International Journal of Operations & Production Management, Vol. 44 No. 4, pp. 729-767. https://doi.org/10.1108/IJOPM-11-2022-0750
Publisher
:Emerald Publishing Limited
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