Research project
The role of capital markets in shaping corporate sustainability
- Start date: 1 October 2023
- End date: 31 July 2024
- Principal investigator: Professor Bin Xu
- Co-investigators: Professor Konstantinos Bozos
Description
Corporate environmental sustainability has attracted increasing attention from policymakers, the public, and academics. For example, ClientEarth, a non-profit legal organization, filed a complaint against British Petroleum (BP), alleging that BP misled customers in a recent advertising campaign by overstating its commitment to addressing climate issues.
Despite the practical importance of this topic, empirical research on environmental violations and greenwashing remains limited. This project aims to advance our understanding of how capital market activists influence the environmental performance and policies of firms.
This project is funded by Leeds University Business School’s Climate Change and Environmental Research Fund.
Research overview
This study examines the effects of investors in both public and private capital markets on corporate environmental misbehaviour, with a particular focus on disentangling selection and treatment effects. It also explores the mechanisms through which firms respond to external environmental pressures and enhance environmental sustainability.