Climate Change Strategies and Firm Performance: An Empirical Investigation of The Natural Resource-Based View of The Firm

Abstract

There is widespread consensus that human activity has had a significant im­pact on global climatic patterns which will have important consequences for much of society. Although there has been much research on the relationship between cor­porate environmental performance and corporate financial performance, empirical testing of the association between proactive corporate climate-change strategies and financial (or accounting) performance is still in its infancy. Based on the logic em­bodied in the Natural Resource-Based View (NRBV) of the firm, firms that success­ fully implement strategies to lessen their effect on climate change should outperform competitors who are less proactive in such efforts. This study uses a matched-pair design to empirically demonstrate that firms with proactive climate change strate­gies achieved significantly higher levels of accounting performance than competi­tors that were less proactive, thus providing additional support for the NRBV.