Does green energy help firm performance?
by Seung-Hyun Lee; Omer N. Gokalp
International Journal of Sustainable Strategic Management (IJSSM), Vol. 4, No. 2, 2013

Abstract: Environmental protection and sustainability is an emerging management topic. However, it is not easy for a for-profit firm to assign financial resources to sustainability, particularly when it hampers financial performance. We use Fortune 500 firms and examine the impact of participation in the green power partnership programme and using higher-priced clean energy on firm financial performance. Since energy is a commodity and clean energy is not different from other sources of energy usage, we argue that firms' financial performance will be hampered by purchasing green energy. However, at the same time we argue that focal firms' stock prices are positively associated with the use of clean energy due to heightened awareness of the importance of environmental protection. We find that using green energy does not hamper firms' financial performance, but we do find that firms' future potential as measured by Tobin's Q is positively associated with green energy use. We conclude by discussing the implications of these findings with respect to increased stock market performance, as well as the potential reasons for our unexpected findings with respect to financial performance.

Online publication date: Mon, 30-Jun-2014

The full text of this article is only available to individual subscribers or to users at subscribing institutions.

 
Existing subscribers:
Go to Inderscience Online Journals to access the Full Text of this article.

Pay per view:
If you are not a subscriber and you just want to read the full contents of this article, buy online access here.

Complimentary Subscribers, Editors or Members of the Editorial Board of the International Journal of Sustainable Strategic Management (IJSSM):
Login with your Inderscience username and password:

Username:        Password:          Forgotten your password?

Want to subscribe?
A subscription gives you complete access to all articles in the current issue, as well as to all articles in the previous three years (where applicable). See our Orders page to subscribe.

If you still need assistance, please email subs@inderscience.com