Carbon Emissions and Economic Profitability: Evidence from Spanish Family and Non-Family Firms
Regarding greenhouse gas (GHG) emissions, in this article we address the academic debate on whether it is more profitable to be a company which is environmentally friendly or one which ignores the recommendations that limit those emissions. The academic debate has an additional interest, when it refers to the field of family businesses that integrate the Socioemotional Wealth (SEW) perspective, through which better environmental performance has been demonstrated by family businesses than their non-family counterparts. The data used have been obtained from the Carbon Footprint Register which was prepared by the Spanish Ministry for Ecological Transition.This information has been completed with financial data of the manufacturing companies that were extracted from the Iberian Balance Sheet Analysis System (SABI) Database, in order to develop a regression model, in which the GHG emissions that are released into the atmosphere are related to the type of ownership of the company, and with other variables that characterise each company in the sample of companies. The results negatively associate the GHG emissions with the level of ROA, which means that the reduction of emissions in a company contributes to improving its economic performance. The results also show that the family ownership of the organisation exerts a significantly negative impact on the total emissions, from which we conclude that there are economic benefits which can be derived from the environmental investment of family businesses. The recommendation for decision-makers is that regulations can push companies towards an effective carbon mitigation strategy, and encourage financial market recognition of companies with a low-carbon economy.