Climate-linked compensation, societal values, and climate change impact: International evidence

IF 4.6 3区管理学 Q1 BUSINESS Corporate Governance-An International Review Pub Date : 2022-11-30 DOI:10.1111/corg.12504

Sudipta Bose, Natasha Burns, Kristina Minnick, Syed Shams

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引用次数: 3

Abstract

Research question/issue

We examine whether linking executive compensation to climate-related performance is associated with better firm-level climate change impact. We also explore the interaction of culture and climate-linked incentive compensation with climate change impact.

Research findings/insights

Using firm-level climate change strategy and carbon emissions to measure climate change impacts, we find that climate-linked compensation is associated with improved climate change strategy. Climate-related incentives for the CEO and other (operational) executives are found to be negatively associated with firm-level carbon emissions, although the relationship is not as strong; however, no such association is found for climate-linked compensation of the board and top-3 executives. Country-level attitudes to whether solutions for environmental issues are considered a joint (society) responsibility versus an individual's personal responsibility are found to have an effect on the association between climate-linked compensation and climate change impacts. We also find that country-level cultural views enhance the positive association between climate-linked compensation and climate change strategy but not the association with actual firm-level carbon emissions. Further analysis shows that non-US firms drive our study's findings. Finally, improvement in climate strategy is found to have a positive effect on Tobin's Q but has no effect on profitability.

Theoretical/academic implications

Academic research is growing on the role of climate change risk and carbon emissions in corporate decisions. The findings of our study are important given that linking executives' compensation with climate performance is gaining momentum. To the best of our knowledge, this is the first study to examine any link between climate-linked compensation and climate change impact.

Practitioner/policy implications

While climate-linked compensation is associated with positive changes in climate strategy, its association with firm-level carbon emissions is promising. This is particularly the case when this compensation is offered to executives who are likely to make operational decisions with a direct impact on a firm's carbon footprint and carbon emissions.

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与气候相关的补偿、社会价值观和气候变化影响：国际证据

研究问题/议题我们研究将高管薪酬与气候相关绩效挂钩是否与更好的公司层面气候变化影响相关。我们还探讨了文化和气候相关激励薪酬与气候变化影响之间的相互作用。利用企业层面的气候变化战略和碳排放来衡量气候变化影响，我们发现气候相关补偿与改进的气候变化战略相关。研究发现，首席执行官和其他(运营)高管的气候相关激励与公司层面的碳排放呈负相关，尽管这种关系不那么强烈;然而，董事会和前三名高管的气候相关薪酬没有发现这种关联。研究发现，国家层面对环境问题解决方案是否被视为共同(社会)责任还是个人责任的态度，对气候相关补偿与气候变化影响之间的关系产生了影响。我们还发现，国家层面的文化观点增强了与气候相关的薪酬与气候变化战略之间的正相关关系，但并未增强与实际企业层面碳排放之间的正相关关系。进一步的分析表明，非美国公司推动了我们的研究结果。最后，发现气候策略的改进对托宾Q有积极影响，但对盈利能力没有影响。关于气候变化风险和碳排放在企业决策中的作用的学术研究越来越多。考虑到将高管薪酬与气候绩效联系起来的势头正在增强，我们的研究结果很重要。据我们所知，这是第一个检验与气候相关的补偿与气候变化影响之间联系的研究。从业者/政策影响虽然与气候相关的补偿与气候战略的积极变化有关，但其与企业层面碳排放的关联是有希望的。当这种薪酬提供给那些可能会对公司的碳足迹和碳排放产生直接影响的运营决策的高管时，情况尤其如此。

本文章由计算机程序翻译，如有差异，请以英文原文为准。

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来源期刊

Corporate Governance-An International Review Multiple-

CiteScore

7.00

自引率

11.30%

发文量

期刊介绍： The mission of Corporate Governance: An International Review is to publish cutting-edge international business research on the phenomena of comparative corporate governance throughout the global economy. Our ultimate goal is a rigorous and relevant global theory of corporate governance. We define corporate governance broadly as the exercise of power over corporate entities so as to increase the value provided to the organization"s various stakeholders, as well as making those stakeholders accountable for acting responsibly with regard to the protection, generation, and distribution of wealth invested in the firm. Because of this broad conceptualization, a wide variety of academic disciplines can contribute to our understanding.