[Seminaire CREM] Reporting for duty : Do firms that engage in carbon reporting change their emission behavior?

Reporting for duty : Do firms that engage in carbon reporting change their emission behavior?

This paper evaluates the effect of the obligation for French firms of more than 500 employees to publish carbon reports to see if it led to changes in carbon emission decisions at the firm level. In particular, we identify abatement expenses and change in energy mix composition as the two levers that firms can use to bring down the level of carbon emissions. We apply a difference-in-differences and instrumental variable model to estimate both the Intention-to-Treat and Average Treatment Effect, and thus the effect of the policy on abatement expenses and on the share of different energy inputs in the energy mix. We find that large firms tend to spend more on abatement items that can decrease the potential carbon dioxide released from the production process, while finding no strong evidence that publishing firms will modify their energy mix composition, either in favor of less carbon heavy inputs like natural gas, or toward electrification.