Abstract / Description of output
Firm emission accounts for a large share of pollution. Based on the sample of 44 countries, this paper studies whether and how firms’ legal environment influences their environmental performance. After presenting new evidence on the positive link between civil law origin and firm environment outcomes, we propose and show that directors with legal study or work experience exert stronger impact on firm environmental outcomes in civil law than in common law countries. We interpret the results as the compliance effect of legal directors is more important to firms located in civil law countries than the litigation risk effect to firms in common law countries. Using a quasi-natural experiment of the Paris Agreement, we find evidence consistent to our interpretation.
Original language | English |
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Publication status | Published - 2023 |