Outperforming Peers Through A Comprehensive Climate Change Strategy: The Case of Electric Utilities

Abstract

Firms increasingly aim to combat climate change. For corporate managers,
the question whether a related strategy affects financial performance arises. Since
empirical research on this topic is rather sparse, this study investigates whether
pursuing a corporate climate change strategy leads to better corporate financial
performance. By applying paired samples t-tests, a sample of 62 companies from
the electric utilities sector matched in pairs is investigated over a five-year time
span. Results indicate that firms with a comprehensive climate change strategy
predominantly perform significantly better than their competitors without such a
strategy. These findings might contribute to promoting climate change strategies in
a corporate context.