Financial Performance as it Relates to Pollution Control : An Empirical Analysis

This paper explores the firm-level characteristics that explain pollution emissions during 1988-1996. Differences in pollution approach between different types of firms provide an unique research setting to investigate how firms with favorable environmental reputations compare to firms with unfavorable environmental reputations regarding emissions what firm characteristics are related to environmental performance, and how firms respond to regulation changes. The paper is the first to use emissions information from a non-financial source to analyze differences between firms to changes in regulatory requirements. The results provide clear evidence that green firms behave markedly different, have different firm characteristics, and react to changes in regulatory regime in different ways than their non-green counterparts