The effects of environmental performance and green innovation on corporate venture capital

Ramzi Benkraiem*, Emmanuelle Dubocage, Yann Lelong, Fatima Shuwaikh

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review

11 Citations (Scopus)

Abstract

The aim of this study is to provide investors, policymakers and others with information on how greenhouse gas (GHG) emissions and green innovation affect corporate financial performance. Although reporting by corporate venture capital (CVC) firms on GHG emissions as well as their green innovation has increased significantly, especially in the last two decades, little is known about how these two factors affect financial performance. To fill this gap, this article investigates the relationships between environmental performance, green innovation, and financial performance in CVC investments in the US over an 18-year period between 2002 and 2019. The results show the effects of GHG-emission reduction and green innovation, both separately and combined, on the financial performance of CVC firms. These findings contribute to the ongoing debate on the role of corporations in the efforts to reach net-zero emissions. The results indicate that emission reductions give firms a financial advantage over time and that there is a financial interest for corporate investors to drive green innovation. These results have important implications for research and practice and illustrate the importance for corporate investors of including ecological considerations in their overall business strategies to create competitive advantage.

Original languageEnglish
Article number107860
Number of pages25
JournalEcological Economics
Volume210
DOIs
Publication statusPublished - Aug 2023

Keywords

  • Corporate venture capital
  • Environmental performance
  • GHG emissions
  • Green innovation

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