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Sustainability 2018, 10(7), 2398; https://doi.org/10.3390/su10072398

The Impact of Carbon Emissions on Corporate Financial Performance: Evidence from the South African Firms

Turfloop Graduate School of Leadership, Faculty of Management and Law, University of Limpopo, Fauna Park, Polokwane 0787, South Africa
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Received: 23 April 2018 / Revised: 17 May 2018 / Accepted: 23 May 2018 / Published: 10 July 2018
(This article belongs to the Section Economic, Business and Management Aspects of Sustainability)
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Abstract

The impact of carbon emissions on corporate financial performance within the African corporate setting has remained open and inconclusive, owing primarily to the unavailability of data. However, this paper examines the effect of carbon emissions (Scope 1, Scope 2, and Scope 1 and 2) on the financial performance (ROE, ROI, and ROS) of 63 South African CDP companies for the 2015 fiscal year. Using multiple regression techniques, the paper found overwhelming evidence of a negative relationship between carbon emissions and corporate financial performance. Thus, results indicate that companies which integrate green investment initiatives designed to lower carbon emissions can effectually manage financial performance. Therefore, the paper provides useful insights on how companies can fully utilise their organisational resources and capabilities as well as gain insight, resulting in a higher environmental and financial performance within a firm. View Full-Text
Keywords: carbon emissions; corporate financial performance; South African CDP firms carbon emissions; corporate financial performance; South African CDP firms
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Ganda, F.; Milondzo, K.S. The Impact of Carbon Emissions on Corporate Financial Performance: Evidence from the South African Firms. Sustainability 2018, 10, 2398.

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