Memory of research : Deliverable 1

Do carbon emission trading mechanisms influence the financial performance

of high-carbon-emitting French companies?

1
 Table of the materials
Introduction ..........................................................................................................................3
Question of research And objectives ...................................................................................4
Methods of search ................................................................................................................5
Conclusion and expected results ..........................................................................................9
Sources ...............................................................................................................................12

2
 Introduction

The 21st century is characterized by a set of unprecedented environmental challenges,

mainly climate change. This results from the accumulation of effect gases of tight In the
atmosphere, issue of activities human intensive Since there revolution industrial. The
effects of these changes are palpable: increasing temperatures global, melting of the ice
cream, elevation of level of the seas And intensification of the phenomena extreme
weather. These phenomena not only threaten biodiversity and ecosystems, but also the
human societies, their economy and their safety.

Face has this emergency climatic, there community international has taken of the measures
For restrict the damage, notably by the 2015 Paris Climate Agreement 1 , where the majority
of countries of the world have committed to limiting global warming to “well below 2°C
compared to pre-industrial levels and to continue efforts to limit the temperature at 1.5°C”.
However, achieving these goals requires radical transformations in the manner whose
companies generate and use energy.

THE sector economic is A actor key In these transformations, in particular THE industries
major CO2 emitters such as energy, manufacturing and transport. These industries make
face has a double pressure : contribute has there reduction of the broadcasts of gas
has effect of tight all in maintain their economic competitiveness.

In this context, the European Union has strengthened its action with the exchange system of
emission allowances (EU ETS) which operates on the principle of "cap and trade ". This
system sets a ceiling on CO2 emissions from heavy industries and energy producers, cap
that gradually decreases to stimulate continued emissions reduction. Companies must
acquire permits to cover their emissions, which creates a walk of carbon Or THE price of
carbon adjusts in function of the offer And of there request.

In 2024, there capitalization of walk European of there pricing And exchange carbon has
reached 770 billion of dollars, according to A report of London Stock Exchange Group 2 ,
This Who underlines the importance economic of This mechanism. THE recipes of This
walk are often reinvested in clean technologies or used to help low-income countries
finance their transitions energy.

However, the effectiveness of these measures and their impact on the economic
performance of companies remain matter has debate. From a go, THE costs of compliance
For THE companies
1
UNFCCC. (2015) 'The Agreement of Paris', UNFCCC. Available at: https://unfccc.int/fr/a-propos-des-ndcs/l-
accord- from Paris
2
Twidale , S. (2024) “Value of global carbon markets hit record $949 billion last year – LSEG”, Reuters, 12
February. Available at: https://www.reuters.com/markets/commodities/global-carbon-markets-value-hit-
record-949- bln-last-year-lseg-2024-02-12/

3
 can be students, affecting potentially their profitability. Else go, he exist of the
opportunities of development of new products And services related has the economy
green.

Question of research And goals

This thesis therefore aims to study what is the impact of rights exchange mechanisms of
carbon emissions on the financial performance of French companies strongly carbon
emitters. This question is part of a speech wider on the sustainable development and
economic resilience. It arises from the crucial need to assess if THE regulations
environmental, such that THE system exchange of quotas (EU ETS), effectively balance the
reduction of the carbon footprint with the maintaining or improving business profitability.
In 2024, according to this same report of London Stock Exchange Group, the capitalization
of the global carbon market has exceeds approximately 949 billion of dollars, either a
increase of 335 % by report has 2020, reflecting her influence growing on THE strategies of
the companies And THE savings national.

Understanding the financial implications of emissions trading goes beyond simple

academic quest; this has tangible implications for policy and strategy commercial. If
emissions trading supports, or even improves, performance financial, more companies
could be encouraged to reduce their carbon emissions carbon, thus aligning economic
interests with environmental objectives. HAS the opposite, if the costs associated with
participation in the ETS (Quota Trading System resignation of EU) harm has there
competitiveness without benefits financial clear, THE companies and policymakers may
need to consider alternative methods or measures additional For encourage there
reduction of the broadcasts of carbon.

Therefore, this thesis aims to deepen the analysis of the impact of exchange systems of
rights resignation on THE settings financial of the businesses, in considering of the
influences economic more wide beyond of the alone results financial direct. By example,
there participation At ETS could to drive to one increase of the investments In THE
technologies green, opening Thus of news outlook commercial Or improving efficiency
operational. In This sense, a investigation carried out in 2022 by THE Carbon Disclosure
Project 3 indicates that THE companies actively committed In THE trade of carbon are 67
% more susceptible to invest In of the innovations aiming has reduce THE broadcasts
that those who do not participate.

Of more, This memory will explore THE implications more wide of trade of carbon on
there dynamic of walk, such that THE changes of behavior of the investors And THE

3
Carbon Disclosure Project. (2021) Engaging the Chain: Driving Speed and Scale . Available has:
https://cdn.cdp.net/cdp-
production/cms/reports/documents/000/006/106/original/CDP_SC_Report_2021.pdf?1644513297

4
preferences of the consumers For of the products And services more durable. The objective
ultimate is to offer of the information complete can to guide THE companies In there
complexity of the markets of carbon And of the regulations environmental. That would
benefit No only to companies in the management of their emissions, but would also help
decision-makers policies has elaborate of the rules Who incite effectively has of the
discounts substantial shows while promoting there economic growth.

Through a careful examination of these dynamics, this thesis intends to contribute to the
discourse on the economy of the environment, in providing a understanding nuanced of
there manner whose emissions trading mechanisms could be optimized to support THE
double objective of sustainability environmental and viability economic.

Methods of research

To address the research question on the impact of rights exchange mechanisms of carbon
emissions on the financial performance of French companies with high broadcast, it is
imperative to adopt a robust and precise methodological approach that can to surround And
isolate THE miscellaneous effects of the regulations environmental on THE dynamic
economic of the companies concerned. The relevance of this methodology is based on
several pillars: the combination of quantitative analysis with an exhaustive review of the
literature, the use of advanced econometric models, and the rigorous selection of data
secondary.

The importance of a comprehensive review of the academic literature cannot be

underestimated, because it provides the theoretical framework necessary to understand the
issues and impacts of Emissions Trading Systems (EU ETS) on companies. This review
helps identify of the studies similar, has to understand THE various hypotheses tested And
THE conclusions drawn by previous researchers, and to situate the current research in the
context academic and practical existing.

To quantify the impact of the EU ETS on financial performance, the adoption of models
econometrics advances such that there method Difference in Differences ( DiD ) And
pairing propensity scores (PSM) is essential. These methods make it possible to isolate the
effect of environmental policies other factors that may influence performance financial of
the businesses. There method DiD allow of compare THE companies Before And After the
introduction of the ETS, All in holding account of the companies No affected by this policy
as band of control. This method is particularly adapted has OUR study because She allow
of to treat THE problems of variables omitted Who could bias THE results.

The use of PSM will also help to strengthen the comparison between companies by
matching each company subject to the EU ETS with a similar company not subject to it.
This process ensures that THE differences observed In there performance financial
are

5
mostly due to the effects of the EU ETS.

Data selection is another critical step in research. The data will be collected from reliable
sources such as the European Environment Agency (AEE), Orbis and company annual
reports. These data will include emissions of CO2, financial information and other relevant
indicators such as Tobin's Q, Who measure the value of walk adjusted At risk of the
businesses.

For a comprehensive analysis, it is crucial to include control variables such as company

size, industry sector and general economic conditions, which could influence financial
results independently of the EU ETS. This will allow to further refine our understanding of
how sectoral specificities and size companies modulate the effects of the EU ETS.

Beyond the methodology and data analysis, it is essential to consider the practical
implications of the research. The Carbon Emissions Trading Policy does not improve not
only there performance ESG of the businesses, but influence Also positively internal
governance and investments in R&D. These elements remind us that environmental
policies, far from being simple constraints, can stimulate innovation and improve there
social responsibility companies.

6
 Review of literature

Existing literature and research studies on the effects of commodity exchange systems
quotas resignation (ETS) on there performance financial of the companies are vast And
complex due to the various results, issues and conclusions presented. Many items have tent
to analyze THE System exchange of quotas resignation of The union European (EU ETS)
and the ETS of other countries, as well as their environmental impacts and their
consequences economic.

Our dissertation will be based on exhaustive and rigorous literature, providing the
framework theory necessary to evaluate the EU ETS from the angle of its impacts and
consequences on THE businesses. This review contributes has identification of the studies
comparable, has there understanding of the numerous hypotheses already investigated and
the conclusions drawn by THE authors previous ones, And has there position of the study
current In THE frame academic And practical.

A study by Dechezleprêtre , Nachtigall and Venmans (2023) 4 claimed that the EU ETS has
had a considerable effect in reducing carbon emissions. However, his effect on there
situation economic of the companies submitted has summer neutral Or slightly positive.
This result positive can explain by THE do that THE companies can adapt their fashions of
functioning In THE system of trading Or bring of the changes functional their

allowing to pull party from the environment of walk of the ETS.

Of even, Martin, R., Muûls , Mr. and Wagner, UJ (2016) 5 capture the idea that the EU ETS
n / A not negatively affected the competitiveness of regulated companies. They attribute
this to the absence of taxes on permits and the fact that companies can pass on the costs on
consumers. These mechanisms helped to reduce the risks of financial impact on companies
and have made it possible to maintain sustainable strategic positions in the market All
respecting the standards established by policies.

But be careful, the implementation of a carbon emission rights trading market is not not
strictly positive. THE results of the different studies are varied. Yue-Jun Zhang And

4
Unleash the priest , A., Nachtigall, D. And Venmans , F. (2023) 'THE joint impact of THE
European union emissions trading system on carbon emissions and economic performance”, Journal
of Environmental Economy And Management, 118, 102758. Available has:
https://doi.org/10.1016/j.jeem.2022.102758

5
Martin, R., Muûls , M. and Wagner, UJ (2016) “The impact of the European Union Emissions Trading
System Regulated business regime: what is the evidence after ten years?', Review of Environmental
Economics and Policy , 10(1), p. 129-148. Available at: https://doi.org/10.1093/reep/rev016

7
Jing-Yue Liu (2018) 6 describe a negative impact of this carbon exchange mechanism in
China, notably For THE companies of industry of the metals No ferrous. Wang, K., Qiao ,
Y., Ling, L., Zhao, Z., and Liu, K. (2023) 7 point out that empirical studies in China confirm
that carbon trading policies are effective in improving efficiency of the broadcasts of
carbon, All in affecting differently there performance financial according to THE sectors
and regions. They conclude that policy researchers should give more attention to the
political and institutional environment, because it influences the effectiveness of carbon
trading systems. Sometimes this can lead to more financial impacts significant for
companies in carbon-intensive industries or those operating In regions with standards
relatively less strict regulations.

On the other hand, we are told that the impact of an emissions trading market carbon in
creating sustainable business practices is not limited to reducing broadcasts of CO2. Zhang,
Liao, Li and Bang (2023) 8 reveal that THE companies participant At trading of carbon are
more inclined has engage their resources In of the technologies green and innovation. This
trend indicates that ETS can have a positive influence on business management approaches
and actions, leading to more business practices respectful of the environment.

Additionally, other studies are conducted to explore economic concerns and strategic issues
related to the EU ETS and business implementation in a trading system of emission quotas.
For example, carbon leakage, where companies offshore their production towards of the
regions with of the regulations environmental less strict, constitutes a major concern. To
counter this phenomenon, the EU introduced the mechanism adjustment carbon to borders
(CBAM). This device imposed A rate on THE imports of carbon-intensive goods in order
to maintain conditions of fair competition by aligning the cost of imports with the carbon
price set by the EU ETS. Although this mechanism is designed to reduce the risk of carbon
leakage and to strenghten THE leadership climatic of the EU, he has aroused of the
debates as to has her efficiency And has
6
Yue-Jun Zhang and Jing Yue Liu, 2019. " Do carbon broadcasts trade affect THE financial performance
of energy-intensive enterprises in China?, " Natural Hazards: Journal of the International Society for the
Prevention and mitigation of natural risks, Springer; International Society for Prevention and Natural
Hazard Mitigation, Vol. 95(1), pages 91-111, January. Available at: https://doi.org/ 10.1007/s11069-018-
3434-5

7
Wang, K., Qiao, Y., Ling, L., Zhao, Z., And Liu, K. (2023) 'THE impact of carbon broadcasts trade policy on
Carbon emission efficiency in Chinese cities: evidence from a quasi-natural experiment", Chinese Journal of
Population, resources and environment, 21, pp. 121-136. Available at:
https://doi.org/10.1016/j.cjpre.2023.09.001

8
Zhang, Z., Liao, J., Li, H. And Stove, J. (2023) 'Impact of Carbon Trade Policy on Business Capital
Structure: Empirical Evidence from China,” Energy Economics, 106, p. 105456. Available has:
https://doi.org/10.3389/fenvs.2023.1141212

8
her impact potential on THE relationships commercial international. THE discussions
legislative And THE negotiations At breast of Parliament European have also put in
evidence of the divergences on there scope and the putting in artwork of CBAM.

In short, this quick review reveals the interest of our research question and shows that a
Consensus is beginning to emerge on the overall effects of ETS, which appear to be
positive Or neutral on there performance financial of the businesses. However, this effect is
not not uniform and varies according to sectors and regions. It will be our responsibility to
confirm or to invalidate these observations has through a analysis in-depth of OUR
question of research.

Conclusion And results expected

For conclude, the objective of this study is of realize a assessment in-depth of the impact
emissions trading systems on the financial performance of companies French countries with
high carbon emissions. In this regard, the research proposed in this application will
undertake a comprehensive review of the existing literature, supplemented by tools
econometrics of point And a collection of data targeted. She will bring of new lighting on
there compatibility of the goals environmental And economic, in particular has the light of
climate change global.

THE results expected of this study include several aspects keys.

First of all, the evaluation quantitative : the EU ETS has of the effects quantifiable on THE
companies, and this study will provide precise clarification of the impact of the EU ETS on
French companies with high carbon emissions. According to recent literature consulted,
these effects seem mostly positive. These results global encompass the impact financial,
ranging from the simple notion of profit to broader concerns such as investment in
environmentally friendly technologies and capitalization stock market.

Second, qualitative perspectives will provide an in-depth understanding of the manner of

which the EU ETS works No only like A tool of compliance, but Also as A agent of change
In there socket of decision And THE practice organizational. This includes changes in the
behavior of investors, consumers and of the market forces in relationship with THE actions.

Finally, of the recommendations policies will be formulated on there manner to establish

And of put implementing emissions trading systems that optimally impact the environment
And the economy. That will understand also of the advice concerning the effectiveness and
efficiency of the policy instrument, based on empirical results of the EU ETS.

9
However, it is important to note that these expected objectives are not set in stone nor will
be necessarily affected, they are topics has change in function of the different insights And
challenges collected during THE next deliverables. He born must not forget that interest of
a study such as a dissertation often resides in the research process itself, where the journey
is more important that there destination. This Steps allow to acquire a understanding more
deep And nuanced of the questions complex has the intersection of the economy and the
environment.

10
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record-949-bln-last-year-lseg-2024-02-12/
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148. Available has: https://doi.org/10.1093/reep/rev016
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10.1007/s11069-018-3434-5
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14
 Sheet conference

Article Author / Goals Problematic Methodology Results Conclusions As

Year ntaries

Word
s-
keys
The impact of Ibrahim Examine the impact of To study how THE broadcasts Data usage annual of 31 The broadcasts of Reduce emissions carbon Index of
Carbon SAKIN, İlker carbon emissions on of carbon influence the companies (2017-2020), carbon have an impact is crucial no only to the sustainab
Shows on KEFE / 2024 there performance financial indicators of analysis with a data model negative on the return environment but also for ility
Firms' financial companies businesses. of panel with effects on THE assets And health financial of the BIST,
Finance listed on the random. THE back on THE businesses. broadcasts
Performance: sustainability index of capital clean of the of carbon,
Year Borsa Istanbul. businesses. performan
Application in This
BIST financial,
Sustainability analyse of
Index data from
panel,
report of
sustainabil
ity.

The Problem Not Investigate issues Assess credit viability carbon Critical analysis of Carbon credits often Carbon credits, such that credits
with Carbon specified/23 associated with credits as a solution for reach the mechanisms current credits correspond not has a they are currently used, carbon,
Credits and FEBRUARY and carbon offsets in the objectives of reduction of carbon, with some project reduction real of the born contribute not compensat
Offsets 2023 frame of there change emissions, highlighting the examples specific and their emissions and can even effective in fighting ed we
explained strategy climatic of integrity issues and efficiency impact on THE walk of the lead to a net increase in against change climatic resignation
Australia. real of these credits emissions. emissions due to flaws and can mislead into s, integrity
in the system of allowing to companies to projects,
credits. claim to compensate their policy
broadcasts without climatic,
changes significant. Australia,
broadcasts
gas has
effect of
tight.

Anthony Evaluate the impact of Uncertainties about the Use of there methodology Reduction statistically The EU ETS has led has US
Unleash the Trading system quotas impact of the EU ETS on of combined match with significant broadcasts a reduction of emissions Broadcasts
priest , Daniel resignation of the emissions carbon And there the difference-in- of carbon of the order of carbon without trading
Gasket impact
Nachtigall , European Union (EU competitiveness of the differences to compare of -10% between 2005 affecting negatively system,
of the
Franc Venmans ETS) on THE broadcasts businesses. regulated installations and And 2012 In THE performance economics Competitiv
European
/ 2023 of carbon and No regulated. facilities regulated by of companies regulated. ness ,
union
performance economics the EU ETS. Carbon
broadcasts Risks that companies
of regulated companies emissions,
trading system outsource their abilities of Data analysis of national The reductions of
between 2005 and 2014. Climate
on carbon production to countries with registers of polluting No impact significant broadcasts were more
policy
emissions and climate policies less strict. emissions in France, the on the profits And important in the second
economic Compare installations and Netherlands, Norway employment of the phase of the EU ETS.
performance regulated companies by and the United Kingdom companies regulated.
the EU ETS with those United.
The biggest facilities The study
Who born the are not For
Increase in income have watch reductions demonstrat
estimate causal effects of
Use of data financial and assets fixed of more emissions es that
this policy environmental.
statements of Orbis and the companies policies of
register of transactions of regulated. walk
of carbon

15
 The union European significant , what as the EU
(EUTL) For THE suggests that the effects ETS
performance economics of on large installations are can be
businesses. more pronounced. effective
For reduce
the
broadcasts
without
compromis
e be there
competitive
tee of
companies
. THE
facility s
more big
and THE
allowances
less
generous
of quotas
free tend
to reduce
any further
THE
emissions.

Jeans Marine, The objective of this The EU ETS introduces a cost The study used A wide The results show that The EU ETS has made it US
Marianne additional for companies panel of European the EU ETS does not possible to reduce Emission
THE impact article is to provide
Sailor, Claudia regulated by the system. companies and a have negatively emissions carbon without Trading
of the evidence empirical studies
Pellegrin / 2018 Traditionally, we think that a methodology of affected the harming economic Scheme,
European on the effect of European
system emissions trading correspondence for compare performance performance companies performan
Emission system quota exchange of
decreases performance companies regulated by the economics of regulated, supporting thus This
Trade emission (EU ETS) on the
economic of the companies by EU ETS with those who businesses. In fact, the the competitiveness of economica
Diagram on performance economics
compared to a scenario without does not THE are not, companies regulated European industry. l e,
several of businesses.
policy. taking into account the have seen a raise Companies reacted by productivit
measurement Unlike studies previous,
characteristics of each significant of their passing on the costs y e, invest
s of economic this article examines the
business before the income and their fixed additional on their ments ,
performance effect of the EU ETS on a
introduction of the EU ETS. assets. EU ETS customers and improving reduction
set more wide range of
Financial data is from the induced businesses to productivity of work. of the
indicators economic
database Orbis, And THE invest more, this which There research future broadcasts,
performance, notably
information on regulatory was able to increase should to focus on the competitive
employment, wages
status come from the the labor productivity. identification of specific you.
means, THE figure
register of transactions of Discounts of emissions mechanisms explaining
business, the value added,
the EU (EUTL). were mostly carried this link.
there margin beneficiary,
out during the second
investment, there labor
phase of the EU ETS,
productivity, total
with a 6% reduction in
productivity of factors
the first phase and 15%
and the return on
in the second phase.
investment (KING).

16
 Dawes, Review initiatives recent Despite their growth, Review of practices current An intersection
McGeady , aiming has create of the voluntary markets carbon are market, of the standards and growing between
Voluntary
Majkut / 2023 marketplaces of carbon fragmented and suffer from initiatives recent integrating activities government
Carbon
plus functional, problems reputation linked to THE efforts from the And of private sector in
Markets: A
transparent and efficient, the quality of compensations. private sector and markets volunteers.
review of
putting particularly the It's missing bonds regulatory governmental. Various news
Global
accent on THE markets has long term or signals of initiatives demonstrate
Initiatives and
volunteers. price, complicating the net of the models
Evolution
zero trajectories of potential to improve
Models
businesses. the functionality and
integrity of walk.

Ralf Martin, Examine the impacts of To understand how THE Literature paper existing Reduction of CO2 The EU ETS has US ETS,
Mirabelle the EU ETS on the regulated companies with an analysis ex post emissions of succeeded in reduce broadcasts
Muûls , Ulrich companies regulated have answered at the EU data from the Phase I And approximately 3% in emissions CO2 without of CO2,
The impact of
J. Wagner / After ten years. ETS. Phase II of the EU ETS. Phase I and the first negative effects trading
the EU ETS on
2016 two years of the significant on the carbon,
Regulated
sentence II. performance economic. performan
Companies: Focus on the CO2 Improve this policy and others Analysis based on
This
What is the emissions, there systems of trading of carbon in aggregated data and
economical
Evidence After economic performance the world. microdata . Reduction of emissions Stimulation modest of
e,
Ten Years? And competitiveness, from 10% to 26% for innovation in
competitive
And innovation. industrial companies technologies clean.
Use of techniques you,
during Phase II.
econometrics For establish innovation,
causality. Need of data ex-
No negative effects microeconomics more analysis
major on the detailed And of research post.
performance economics additional for improve the
of regulated companies. understanding of impacts
of the EU ETS.

Stimulation modest of
innovation in
technologies clean.

Impact of Zhaolong Study how the market There regulation Model of difference in There policy of walk The implementation of Policy
Carbon Zhang, Jin policy carbon in China environmental And THE risks differences (DID) based reduced carbon the market policy carbon Steps of
Political Liao, Hanlin Li, affects there structure of of transition associates At on THE data of the significantly the ratio modifies significantly carbon,
commercial on Jia Qi Stove / capital of the businesses. climate change do they companies listed in China debt of the businesses. making decision structure
Business 2023 influence the structure of in the high-intensity sector financial of the capital of
Capital capital companies ? energy. companies in response to the
More pronounced
Structure: shocks high risks companies
effect among
Empirical induced by politics. , emission
companies receiving
Evidence of of shares,
less than subsidies
China cost of
governmental and
debt,
among companies
China
No states.

17
The effects of Jingyin Liu, Analyze the impact of There is no unified consensus Using a method of multi- THE policies ETS THE policies ETS have A Innovation
carbon Xiao Liu / 2023 trading systems of the on the effect of the policies propensity score period and have significantly positive effect on technolog
emission trade broadcasts of carbon pilots ETS on innovation green differences in differences encouraged innovation innovation green y that
diets on Green (ETS) on innovation technology. (PSM-DID) For analyze green technology In technology industrial green,
technological green technology THE data of panel from THE companies companies, thus system of
innovation by industrial companies in 2007 to 2019 of Chinese industrial. supporting Porter's trade of
The effects of ETS policies on
industrial China. listed companies in sotck hypothesis. the
innovation of the companies
companies: exchange. broadcasts
industrial don't have not been This effect positive is t
Evidence of a of carbon,
Evaluate the mechanisms enough explored. more marked for large Companies more big size
quasi- natural method
of influence of the Construction of a quasi- companies size, with a And those with a better
experiment in PSM-DID,
policies ETS on natural experience to better governance governance are more
China mechanism
innovation green examine the effects causes business, And likely to benefit ETS
s of
technology businesses. of policies ETS drivers particularly in the policies.
influence
from China on mining industries and
,
technological innovation manufacturers.
R&D spending can act responsibili
green business.
as a brake has ty social
The responsibility innovation green due to ity of the
corporate social And signals from carbon companies
THE income operating price insufficiently , income
have been identified as strong. operating
factors engines of these we spend s
effects on innovation, fr R&D
while the expenses in
R&D have inhibited
these effects.

Is it true that César Dugast / Examine the A nine-month investigation The investigation is based 94% of the credits The methods of REDD+,
90% of carbon 26 January effectiveness of REDD+ conducted by journalists on three scientific REDD+ have not had certification of projects credits
the credits are 2023 carbon credits issued by from The Guardian, Die Welt publications recent of effect significant on carbon must be corrected carbons,
no value? Verra, the most great and SourceMaterial revealed analyzing THE credits of there fight against THE of all emergency to Will see,
standard of that 90% of carbon credits Verra and over a dozen change climatic. ensure that the private deforested
compensation At world. REDD+ have no impact interviews with climate financing serve Has we walk
positive on the climate. scientists, voluntary market projects truly additional voluntary
The scenarios of
insiders of carbon and and effective For THE of carbon,
Determine the impact reference have
developers of projects. climate. methodolo
real of these credits on The gap between forecasts overestimated the
gie of
THE climate. Will see And there reality is positive effect of
certificate
assigned has reference Analysis of 87 projects projects, with a Carbon credits do not
not,
scenarios exaggerating the preservation certified by overestimation going must not be counted as of
neutrality
threat of deforestation. Will see. until +400% even the emissions reductions
carbon,
+950% without direct by the businesses.
reduction
projects successful of
of the
Madagascar.
The voluntary market broadcasts
carbon presents flaws , initiatives
Among the 29 projects structural serious that Net Zero .
analyzed, only 8 had a need to be resolved to
real impact on the avoid losing time and of
climate, and only one money precious.
had an effect equal to
or higher than
forecasts by Verra.

18
The impact of Dan Loohuis / The main objective of The study addresses the A regression analysis fixed The results show that The study concludes that broadcasts
Carbon The 2022 this study is of question of find out if effects with errors robust the increase in carbon he is not not financially of GHGs,
broadcasts on determine if there is a companies can be big polluters standards ist applied to a emissions led has a beneficial for a company policies
Business relationship between
while remaining profitable, or sample world of 830 financial performance to emit more of CO2. surroundi
Financial there financial
Performance performance of if the consumers and investors companies, covering the weaker at short and Businesses with ngs
companies (CFP) and penalize these businesses. years 2017 to 2021. The long term. THE broadcasts high are mental,
their performance THE sub-questions include : variables dependent are the negative coefficients penalized both in the System
environmental (CEP), in ROA, the ROE and Tobin's shows of carbon short term and long term. exchange
se concentrating q, while that there variable indicate a inverse THE investors value of quotas
specifically on the Businesses benefit they
independent is the carbon relationship with THE companies with GHG resignatio
broadcasts of carbon. financially to emit more than
performance of businesses, variables dependent emissions reduced, n (ETS).
CO2 ?
measured by carbon (ROA, ROE, Q). which is reflected in a
emissions divided by THE better valuation of walk.
The performance sales.
environmental impact of a
does business have an
effect negative on her
performance short-term
financial (measured by
ROA and ROE) ?

Performance in terms of carbon

has she A effect negative on
financial performance long
term (measured by Tobin's q) ?

The impact of Yadu Zhang, Analyze the impact of The trade policy of broadcasts The study uses data The policy of trade in Trade policy carbon policy of
Carbon Yiteng Zhang, trade policy carbon of carbon improved- does it collected from Chinese carbon emissions emissions is effective For trade of
Emission Zuoren Sun / emissions on ESG significantly ESG performance listed companies on the improved improve performance the
Trading Policy 2023 performance
of companies? stock exchange in Shanghai significantly the ESG Corporate ESG. She broadcasts
on Enterprise (Environment, Social
ESG And Governance) of and Shenzhen of 2011 has performance of promotes R&D of carbon,
Performance: Chinese companies listed 2019 And the ESG scores businesses. investments and the ESG,
What are the mechanisms by
Evidence from on the stock exchange of Bloomberg. The method improvement of controls regulation
which this policy influence
China and understand the of difference in difference internal, thus leading to surroundi
mechanisms of this there performance ESG, The robustness of
(DID) is used for analyze more sustainable ngs
influence. notably through THE results is confirmed
the impact of trade policy practices and responsible. mental,
investments in R&D and level by of the tests of
carbon emissions on the THE results offer invest lies
of internal control of robustness multiple.
ESG performance of practical implications For in R&D,
companies?
companies and their THE governments And level of
mechanisms. Politics of trade in THE companies on there control
carbon emissions way of managing policies internal.
encourages businesses environmental and
to increase their promote the development
investments in R&D sustainable.
and to improve their
controls internal,
which, in turn, improve
their performance ESG.

The positive impact of

this policy is more
pronounced in the
companies with low
carbon emissions,
those where the CEO
is distinct of president
of advice, those with a
high degree of
transformation

19
 digital And those
receiving subsidies
government
important.

Tea US ETS Magnus The main objective of this The key questions addressed by The study uses models The increases The study concludes that US ETS,
and Firm Poulsen and study is to examine the the study includes: multifactorial with (decreases) in prices the EU ETS encourages performan
Finance Pontus Lofgren impact of variations in longitudinal data balanced emission quotas of the financially THE This
Performance: / 2020 price of the quotas
covering thirteen European EU ETS have a impact companies of electricity financial
Evidence from resignation of the EU How THE variations of price
the European ETS on the financial companies electricity positive (negative) on production at reduce their of the
EU emission allowances ETS
Electricity performance companies production during the third THE yields emissions carbon. companies
do they affect there financial
Sector in the sector of the phase of the EU ETS. The scholarship holders Businesses less intensive ,
performance of companies in
production electricity in data financial and intensity businesses. in carbon benefits more production
Europe during there third the sector electricity in
information carbon of price increases of quotas electricity
phase of the EU ETS. Europe?
companies have summer resignation, suggesting star,
This positive
obtained has leave of basics that THE EU ETS intensity
relationship is stronger
Companies with a less of data financial and annual policies are effective for carbon,
for companies with a
electricity production carbon reports of businesses. THE promote practices quotas
electricity production
intensive do they benefit any regressions fixed effects and electricity production resignation
less intensive in
further of the price increases models econometrics have cleaner. .
carbon.
of quotas of emission? been used to analyze the
data.
Businesses benefit of
there ability to pass on
THE costs of
compliance broadcasts
on consumers, which
increase their margins
beneficiaries

How TO DO Wenhao Ma Study how the trade The trade policy of carbon The study used A model of Politics of trade in Trade policy carbon trade of
carbon and Xuwen policy of the broadcasts emissions exercise it has an difference in differences broadcasts of carbon emissions in China the
broadcasts Yan / 2023 of carbon influence the inhibitory effect on the (DID) based on data has an inhibitory effect reduced effectively broadcasts
business financialization of
financialization of the Chinese companies listed meaningful and lasting financialization of of carbon,
impact THE companies no financial
financializatio institutions in China, companies No financial ? on the stock exchange from on financialization companies No financial financiers
n n of non- using a quasi- 2008 to 2020, with a group companies not by mitigating THE ation ,
financial experiment natural. of treatment and a group of financial. constraints of funding. constraints
What are the mechanisms by
businesses? control. The data come This policy thus promotes of finance
Evidence of a which this policy affects
from of the China Research transition to a economy nt,
quasi- natural financialization, in particular Companies located in
Data Services Platform has weak carbon while companies
experiment in by there reduction of the pilot areas see their
(CNRDS) and the China supporting the No
China constraints financing? degree of
Security Market and development stable financial
financialization
Accounting Research economy. , China.
decrease so significant
(CSMAR).
after the
implementation of
policies of trade shows.

There policy reduced

THE constraints of
financing of
businesses, which
contribute to there
decrease in
financialization.

20
 The inhibitory effect is
more pronounced for
companies no state,
those located in the
regions oriental And
those operating In of
the highly industries
competitive

Can carbon Yi Yang and Examine the impact of The trade policy of broadcasts The study uses the method Politics of trade in There policy of trade trade of
broadcasts Ming Zhu Liu policy of trade carbon of carbon improved- financial differences in differences carbon emissions carbon emissions the
trade calendar / 2023 emissions (CETS) on the performance companies ? (DID) on a sample of improved significantly improves performance broadcasts
improve the financial performance
companies Chinese the financial financial of companies, of carbon,
financial companies listed in stock
performance market in China, as well companies in the sector of performance especially when THE performan
How does innovation
of listed as the moderating effect electricity listed on the stock companies. companies invest in This
technological and the scale of
businesses? of innovation exchange of 2006 has 2020. innovation technological. financial,
funding moderate the effect
THE technological and the THE data come from of the However, a large funding innovation
moderation scale of funding. of this policy on there Innovation moderate
China Stock Market & scale can reduce the technology
effect of financial performance? technology positively the
Accounting Research positive effect of this that, scale
technological effect of this policy on
Database policy. THE regional of finance
innovation and performance financial.
funding ladder differences also influence nt,
efficiency of there policy, differences
The scale of moderate with more results marked regional.
financing negatively in the regions more
the impact of this developed.
policy on performance
financial.

The effect of there

policy is more
significant in regions
with A high degree
of
marketization .

The effects of Nicolas Study the impact of The exchange system The study used there Total emissions of The exchange system trade of
Carbon Kramer and exchange system emission quotas of the method of synthetic control CO2 in California emission quotas of the the
Trade: Christian emission allowances California does it lead a for construct a decreased by 0.9% California contributed to a broadcasts
Evidence of Lessmann / (ETS) of California on
significant reduction in counterfactual optimal, per year compared to modest reduction but of carbon,
from 2023 broadcasts of carbon and
California economic results. broadcasts of CO2? using of the panel data for counterfactual, i.e. a significant CO2 ETS,
ETS Evaluate the effects of everyone American states. reduction total of 6.3 emissions, while having California,
this emissions policy of THE outcome variables % between 2013 And of the effects economic broadcasts
What are THE effects 2019.
CO2, GDP, employment include THE broadcasts of positive. of CO2,
and turnover industrial. economics of this policy,
CO2, THE Real GDP, Although the reductions impacts
notably on THE GDP,
employment and industrial emissions are not economica
employment and figure The reduction of
turnover. The analysis massive, the results show l are,
business of the companies emissions is
period covers from 2013 to that there policy did not method
? particularly notable in
2019. entail any costs high control
THE electricity sectors
economic and even synthetic
and buildings, with
stimulated there growth e.
annual declines
economic.
respective 6.2% and
1.4 %.

THE effects economic

global are positive,
with an increase of
GDP, employment and
of figure business of
the
businesses .

21
The Financial Georgia Examine THE factors Companies participating in the The analysis is based on a The variables Profitable businesses are US ETS,
Performance Makridou , Who influence EU ETS risks losing market panel database covering influencing the generally more big, know profitabilit
of Firms Kostas profitability energy- shares compared to non- over 4,100 European profitability of a economic growth and y of the
Participating Andriosopoulos intensive sectors covered participating companies and to companies participating in
companies include are more effective on companies
in the EU , Michael by the system quota global competitors, this which the EU ETS of 2006 has
Broadcasts Doumpos , exchange EU emission could affect negatively their 2014. THE companies are solvency, there size, energy plan. There , efficiency
Trading Emilios certificate (EU ETS). performance economic. classified into eight main THE operating income business profitability energy e,
Scheme (EU Galariotis / The study aims to sectors code-based compared to assets participating in the EU quotas
ETS) 2018 determine the impact of industrial NACE Rev.2 for totals and growth of ETS is influenced by their resignation
the EU ETS on the two numbers. The GDP of country. internal characteristics, ,
competitiveness of profitability of companies is their performance energy, performan
companies by analyzing analyzed using techniques
THE policies energy and This
their profitability. of regression and data
aggregated at national level the environment economy economica
And companies. THE The variables of the country. THE l e.
variables used include environmental, such effectiveness data energy,
factors economic, that the postman the amount verified
environmental and related to allocation and ratio of emissions of CO2 and
energy. THE number of allocated
the broadcasts verified
compared to sales, quotas provide
have a negative impact informations additional
on the profitability of valuable on the
businesses. profitability of the
businesses.

Efficiency energy And

THE policies energy
sources of the country
host have an impact
significant on the
profitability of
businesses.

A more allowance
large number of
quotas relative to
broadcasts verified is
associated with a
profitability more
weak
Does carbon Yue Jun Zhang Study the impact of THE THIS of there China does The study used A model of The impact of CET on The CET policy of the trade of
broadcasts And Jing Yue system of trade of the it affect the financial difference in differences financial performance China may not guarantee the
commercial Liu broadcasts of carbon performance of companies (DID) data-driven panel of of the companies there profitability has broadcasts
effect the / 2018 (CET) of China on the
participants ? 4,100 companies listed in present a heterogeneity short term For all THE of carbon,
financier financial performance
performance companies of industries seven industries has strong industrial obvious: businesses, but he y has a performan
of high energy- to strong energy consumption of energy. possibility of long-term This
Does this impact vary function
consuming consumption, covering Industries include profitability. The effect of financial,
of the industries And At The CET reduced
companies in the period of 2010 has chemicals, construction CET is more pronounced industries
China? 2017. thread of time ? there financial
materials, steel, THE in some industries, to strong
performance
metals No ferrous, paper, highlighting the need to consumed
companies of metal
energy electrical and adapt the policies based tion
industry No ferrous.
aviation. THE data cover on features specific energy,
there period from 2010 to industrial For maximize model of
2017. He improved there efficiency And there difference
financial performance profitability. in
companies from differences
energy sector electric. , China.

The impact of CET

varies over time, with a
shift effect from 2 to 4
years for the

22
 chemical industries ,
paper and aviation,
passing of a negative
impact on a impact
positive.

The impact of Stefano F. The article aims to The main problem addressed is The study consists of a The article concludes The results suggest that US ETS,
the EU Green, 2020 examine THE effects of of determine if the EU ETS has detailed review of the that it no has no the EU ETS did not competitive
Broadcasts System Quota Exchange had negative effects Or econometric literature evidence clear and have major impact on tee, leak
Trading EU Emissions (EU ETS) positive on the competitiveness existing, in using different widespread that the EU the competitiveness of carbon,
System we on competitiveness of regulated companies and if approaches and data to ETS has had of the regulated companies or evidence
Competitivene regulated companies and it has caused carbon leaks evaluate the impacts of the negative effects or caused leaks notable econometri
ss and Carbon carbon leakage, in significant. EU ETS on various positive on the carbon. cs what
Leakage: The analyzing literature indicators of competitive competitiveness of However, there is a
Econometric econometric available. performance, notably THE companies regulated. certain heterogeneity in
Evidence profits, THE income, Of more, he no of the estimated effects, and
employment, productivity, significant evidence of studies additional are
and exchanges commercial carbon leakage linked required For examine
international. to this system. long-term effects on the
economy via leaks
investment or dynamics
of businesses.

Yadu Zhang, Analyze the impact of Lack of studies empirical Using the method of the Trading policy shows Trading policy carbon Policy
Yiteng Zhang, trading policy carbon studies on the impact of difference in differences of carbon improves emissions is effective For trading of
Zuoren Sun / emissions on the ESG trading policies carbon (DID) on a panel of significantly the ESG improve performance the
The impact of
2023 performance of emissions on ESG company data listed in A- performance of Corporate ESG. She broadcast
Carbon
companies And explore performance of companies shares of Shanghai and businesses. THE encourages businesses to s of
Emission
THE mechanisms by And THE mechanisms Shenzhen 2011 to 2019. businesses increase invest in R&D and has to carbon,
Trading Policy
which this policy underlying. The scores ESG are their investments in strenghten their controls ESG,
on Enterprise
influences performances obtained of there base R&D and improve their internal. These results regulation
ESG
ESG Bloomberg data and other internal controls in provide evidence surroundi
Performance
information corporate respond to this policy. empirical on the impact ngs
financial of the base of data The impact positive is regulations based mental,
CSMAR. more pronounced in the environmental on THE invest lies
companies with low market on the behavior in R&D,
carbon emissions, those sustainable companies control
where the CEO is and offer directions internal,
separated from the theoretical for the transforme
company, those with a governments in the d tion
top degree of regulation environmental. digital,
transformation digital, grant s
And those receiving governmen
subsidies government t entales .
high.

23
The Financial Patrick Bolton, Analyze how THE cost Companies with high GHG The study uses data of Levels carbon Financial markets cost
Cost of Zachery Halem, carbon financier (FCC) is emissions do they suffer a 16,995 companies global, emissions have A increasingly integrate financial
Carbon Marcin integrated into the discount on their multiple of mostly in Europe And in impact negative And transition risk carbon in of carbon,
Kacperczyk / financial assessments
valuation? America of the North, increasing on the ratios THE evaluations of broadcasts
2022 companies, in particular
how the broadcasts of gas covering the period of 2016 P/E of companies, businesses, what se of GHGs,
has effect greenhouse has 2020. THE data come reflecting a discount translated by of the P/E ratios,
How THE risk of is the carbon
gases (GHG) affect THE from S&P Global Trucost required by the haircuts on THE multiple risk of
transition taken into account?
multiple of valuation, and Bloomberg, including investors for of valuation for transition
such as price/earnings account by investors In THE
THE broadcasts of GHG compensate for the risk companies with high carbon,
ratios (S/E). evaluations financial
and information financial of of transition carbon. emissions. This trend decarboniz
companies ?
companies. Statistical should strengthen with ed ation .
analysis includes fixed the increase in regulations
This discount is more
effects by country and and increased awareness
pronounced for the
industry. of risk investors climatic.
large companies And
industries with strong
emissions.

Sectors with a annual

increase important of
shows are the most
heavily discounted by
THE investors.

Others gas to effect

Greenhouse, as the
methane and THE
HFCs, also begin to
have an impact on
THE evaluations
financial, although
lesser that THE CO2.

A Corporate Florian Heider, Review policies THE constraints of funding Industrial equilibrium model The cap-and-system A cap-and- trade Policies
Finance Novel Inderst / environmental optimal external introduce a gap And externalities of the trade is optimal when systemic must hold surroundin
Perspective on 2021 when it is costly for between reduction targets of emissions based on model by there is enough funds account of constraints gs mental,
Environmental companies to get of the emissions and the size of the Holmström and Tirole internal. external financial and cap-and-
Policy financing external industry, making it difficult (1997) of finance business. sectoral heterogeneity to trade ,
the optimization of a system be efficient, requiring a constraints
The constraints of
uniform cap-and- trade . allocation specific quotas of finance
external financing
emissions. nt, models
require ceiling
of finance
adjustments resignation
business e,
above of the reference
quotas
pigouvian.
resignation
s,
A policy uniform is not deduction
optimal in presence of of the
constraints financing emissions.
and heterogeneity
between businesses or
THE
sectors .

24
THE effects Timothy Laing, Examine the effects and Does the EU ETS reduce Literature paper The EU ETS has The EU ETS has had an US ETS,
And side Misato Sato, side effects of exchange effectively THE broadcasts econometric And of the contributed has an impact measurable on reduction
effects of the Michael Grubb, system EU emission of GHG ? studies case study on the average reduction there reduction of the
EU broadcasts Claudie allowances (EU ETS) on
impact of the EU ETS. annual emissions from broadcasts, but its effect broadcasts,
trade scheme Comberti / 2014 there reduction shows,
investment in low-cost Methodologies include of 40 to 80 million tonnes on innovation and innovation,
Does the EU ETS stimulate
technologies carbon the models economics, of CO2, i.e. 2 to 4% of investment is less clear. profits
innovation And investment in
emissions, profits and studies of panel, surveys emissions total capped. The repercussion of CO2 unforeseen
low-cost technologies
impacts on THE price. and data analyzes of market costs resulted in price , impacts
emission of carbon ?
to evaluate the impacts increases for consumers, on THE
The evidence on the
before and after financial while that unforeseen price,
impact of the EU ETS
1. What are the crisis. profits raised questions on regulation
on innovation and
effects economic efficiency and equity of surroundin
investment are mixed.
secondary, such system. Of the future gs mental.
Although some
that profits adjustments should se
investments in
unforeseen events focus on improving the
energetic efficiency
and impacts on efficiency of the system,
and reduction of
the price of the the reduction in profits
broadcasts have been
products ? unforeseen events and
observed, the impact
promotion of innovation
on the big decisions
has long term.
investment has long
term remains limited.

The companies of
electricity sector have
echoed between 20
% and 100% of costs
of CO2 on the
consumers. profits
unforeseen have
summer carried out, in
particular in sectors
with high intensity
emissions, in reason of
the allowance
free of the quotas.
Anatomy of Aviel The objective main of Discussions and evaluations on The article uses an approach The EU ETS aims has The EU ETS is designed policy
Broadcasts Verbruggen, this article is to provide a ETS are often confused due to analytics based on the reduce THE broadcasts to minimize THE charges climatic,
Trade Erik Laes, detailed analysis and different interpretations of anatomy of ETS, by of GHG while financial on the EU design of
Systems: what Edwin structural systems essential concepts like carbon
focusing on four main protecting existing industries in order to the
is THE EU Woerdman / emissions trading (ETS), price, the ceiling of emissions,
ETS? 2019 in particular the EU ETS. and the efficiency of emissions components: political industries against the prevent leaks carbon, but systems
He intended to clarify reductions. There is a need for objectives, the allocation of leaks from carbon. this limits her efficiency trading of
key concepts and to clarification on the objectives permits, price levels of has induce innovations the
evaluate the different pursued by the ETS and how carbon emissions, and technological important. broadcasts,
constituent elements of these systems can to balance The EU ETS uses a
expenses mitigation. This For achieve reductions price of
these systems for better THE environmental objectives system hybrid Or a part
analysis is completed by a more emissions carbon,
understand their design and industrial. of the permits is
“value” methodology tree " ambitious, reforms are innovation
and their functioning. auctioned and another
which allows you to connect necessary, notably the induced,
part is allocated free,
the political objectives to prices of carbon more leak of
in particular to
moral values And to students And a license carbon, US
industries to strong
requirements Design. allocation more strict. ETS.
intensity energy.
The combination
protection objectives
Carbon prices in the industrial and stability
EU ETS have been atmospheric requires a
volatile And generally careful design ETS to
down, but of the avoid conflicts of interest
mechanisms of price and maximize profits
stabilization are in environmental and
place for future phases. economic.

25
Mitigation costs vary
considerably depending
on sectors, and prices
higher are necessary to
encourage Has
innovations significant
in matter of
decarbonization

26