How does environmental performance affect financial performance? Evidence from Japanese manufacturing firms

This paper examines the effects of environmental performance on financial performance using the data of Japanese manufacturing firms from 2004 to 2008. As the environmental performance, our study considers the two different environmental issues of waste and greenhouse gas emissions in capturing the effects of corporate environmental management on financial performance. In addition, to clarify how each financial performance responds to a firm’s effort in dealing with different environmental issues, we utilize many financial performance indices reflecting various market evaluations. Our estimation results show the different effects of each environmental performance on financial performances. For example, while an increase in waste emissions generally improves financial performance, their reduction ameliorates financial performance in dirty industries. In addition, while greenhouse gas reduction leads to an increase in return on equity, it does not have a significant effect on return on sales which reflects the evaluation in the goods market, and it leads to a decrease in the natural logarithm of Tobin’s q, which indicates the value of intangible assets.Environmental Performance; Financial Performance; Japanese Manufacturing Firms; Waste Emissions; Greenhouse Gas Emissions

Greenhouse gas emissions and the role of the Kyoto Protocol

Our study empirically investigates the effects of the Kyoto Protocol’s quantified emission limitation or reduction commitments on various greenhouse gas (GHG) emissions such as CO2, CH4, N2O and other greenhouse gases, consisting of HFCs, PFCs and SF6. These GHG emissions are considered to be the main source of global warming issues and 39 countries approved to meet the commitments by ratifying the Kyoto Protocol. Our empirical analysis is based on the STIRPAT model, the stochastic version of the IPAT model, using the data of 119 countries in 1990, 1995, 2000 and 2005. Our main findings are that the effects of the commitments to the Kyoto Protocol (1) are significantly negative for the cases of CO2 and CH4 emissions, (2) are not significant for the case of N2O emissions and (3) are significantly positive for the case of other greenhouse gas emissions. These results have important policy implications for global warming issues.Greenhouse gas emissions; Kyoto Protocol; Sustainability; IPAT; Panel data

Effects of competition forms and market structure on green innovation incentives

This paper analyzes the effects of environmental policy on green innovation. We compare the incentives for green innovation in both the Cournot and Bertrand competition. It is shown that positive incentives for green innovation exist in both competition models. When environmental regulations are imposed, the effects of the probability of success on green innovation incentives differ between the Bertrand and Cournot competition. Additionally, we clarify the conditions necessary for the establishment of the Porter hypothesis in both competition models

Effects of competition forms and market structure on green innovation incentives

This paper analyzes the effects of environmental policy on green innovation. We compare the incentives for green innovation in both the Cournot and Bertrand competition. It is shown that positive incentives for green innovation exist in both competition models. When environmental regulations are imposed, the effects of the probability of success on green innovation incentives differ between the Bertrand and Cournot competition. Additionally, we clarify the conditions necessary for the establishment of the Porter hypothesis in both competition models

Empirical Study on the Determinants of CO2 Emissions: Evidence from OECD Countries

This paper empirically investigates the environmental Kuznets curve (EKC) for CO2 emissions in the cases of 11 OECD countries by taking into account the role of nuclear energy in electricity production. The autoregressive distributed lag (ARDL) approach to cointegration is employed as the estimation method. Our results indicate that energy consumption has a positive impact on CO2 emissions in most countries in the study. However, the impact of trade is not statistically significant. The results provide evidence for a role of nuclear power in reducing CO2 emissions only in some countries. Additionally, although the estimated long-run coefficients of income and its square satisfy the EKC hypothesis in Finland, Japan, Korea and Spain, only Finland’s EKC turning point is inside the sample period of the study, providing poor evidence in support of the EKC hypothesis.CO2; Environment; EKC; OECD; ARDL

Empirical Study on the Environmental Kuznets Curve for CO2 in France: The Role of Nuclear Energy

This paper attempts to estimate the environmental Kuznets curve (EKC) in the case of France by taking the role of nuclear energy in electricity production into account. We adopt the autoregressive distributed lag (ARDL) approach to cointegration as the estimation method. Additionally, we examine the stability of the estimated models and investigate the Granger causality relationships between the variables in the system. The results from our estimation provide evidence supporting the EKC hypothesis and the estimated models are shown to be stable over the sample period. The uni-direction running from other variables to CO2 emissions are confirmed from the casualty tests. Specifically, the uni-directional causality relationship running from nuclear energy to CO2 emissions statistically provides evidence on the important role of nuclear energy in reducing CO2 emissions.CO2; Environment; EKC; Nuclear; France; ARDL

Environmental Regulation and Choice of Innovation in Oligopoly

This study investigates the effect of an environmental regulation on the innovation choice of firms in an oligopoly. Most existing studies on environmental regulations and innovations examine the optimal behavior of firms when one innovation project is feasible. In our model, firms are allowed to choose from multiple types of innovation projects. Our main contributions are that we derive the conditions under which environmentally friendly and cost reducing innovations are selected in Bertrand competition and we show how environmental regulation affects innovation choice

Disclosure of environmental information and investments of firms

In recent years, voluntary approaches are expected to function as new environmental protection tools. This article analyzes whether environmental information of firms should be mandatorily disclosed or disclosed voluntarily, where consumers consider the environmental burdens of firms when buying their goods. If a mandatory policy is implemented, every firm in the market will be required to disclose their environmental burdens. On the contrary, only firms that want to disclose their environmental burdens will share their environmental information if a voluntary approach is implemented. This article particularly demonstrates the effects of the disclosure rule (mandatory or voluntary) on investment to reduce environmental burdens. The model has two types of firms, clean and dirty ones. Firms that investigate their environmental burdens and turn out to be dirty can invest to reduce them and become clean before they disclose their environmental information. The main conclusions in this article are as follows. (1) Mandatory disclosure policies may induce firms to invest more than a voluntary approach. (2) Firms may have lower expected profit under the mandatory rule than the voluntary approach. (3) Under full information disclosure policy, the environmental burden is smaller than that of other policies

Disclosure of environmental information and investments of firms

In recent years, voluntary approaches are expected to function as new environmental protection tools. This article analyzes whether environmental information of firms should be mandatorily disclosed or disclosed voluntarily, where consumers consider the environmental burdens of firms when buying their goods. If a mandatory policy is implemented, every firm in the market will be required to disclose their environmental burdens. On the contrary, only firms that want to disclose their environmental burdens will share their environmental information if a voluntary approach is implemented. This article particularly demonstrates the effects of the disclosure rule (mandatory or voluntary) on investment to reduce environmental burdens. The model has two types of firms, clean and dirty ones. Firms that investigate their environmental burdens and turn out to be dirty can invest to reduce them and become clean before they disclose their environmental information. The main conclusions in this article are as follows. (1) Mandatory disclosure policies may induce firms to invest more than a voluntary approach. (2) Firms may have lower expected profit under the mandatory rule than the voluntary approach. (3) Under full information disclosure policy, the environmental burden is smaller than that of other policies

Modeling and Flight Data Analysis of Spacecraft Dynamics with a Large Solar Array Paddle

The Advanced Land Observing Satellite (ALOS) was launched on January 24 2006 and has been operated successfully since then. This satellite has the attitude dynamics characterized by three large flexible structures, four large moving components, and stringent attitude/pointing stability requirements. In particular, it has one of the largest solar array paddles. Presented in this paper are flight data analyses and modeling of spacecraft attitude motion induced by the large solar array paddle. On orbit attitude dynamics was first characterized and summarized. These characteristic motions associated with the solar array paddle were identified and assessed. These motions are thermally induced motion, the pitch excitation by the paddle drive, and the role excitation. The thermally induced motion and the pitch excitation by the paddle drive were modeled and simulated to verify the mechanics of the motions. The control law updates implemented to mitigate the attitude vibrations are also reported