TY - JOUR
T1 - Corporate carbon dioxide emissions and the cost of debt financing
T2 - Evidence from the global tourism industry
AU - Wang, Ying Chieh
AU - Feng, Zhi Yuan
AU - Huang, Hua Wei
N1 - Publisher Copyright:
© 2020 John Wiley & Sons Ltd
Copyright:
Copyright 2021 Elsevier B.V., All rights reserved.
PY - 2021/1/1
Y1 - 2021/1/1
N2 - In this article, we investigate the value consequence of a firm's irresponsible environmental behavior, carbon dioxide emissions, through the lens of lenders and bondholders. We firstly find that a firm's carbon risk significantly enhances the cost of debt financing. In particular, we find that the positive nexus between a firm's carbon emissions and the cost of debt has a great discrepancy in countries which have different institutions, cultures, and strength of legal rights. Our empirical evidence suggests that corporate environment risk may raise default risk and ultimately provoke creditors to enhance their required returns. Furthermore, our findings also are consistent with the viewpoints of stakeholders and ethical theories.
AB - In this article, we investigate the value consequence of a firm's irresponsible environmental behavior, carbon dioxide emissions, through the lens of lenders and bondholders. We firstly find that a firm's carbon risk significantly enhances the cost of debt financing. In particular, we find that the positive nexus between a firm's carbon emissions and the cost of debt has a great discrepancy in countries which have different institutions, cultures, and strength of legal rights. Our empirical evidence suggests that corporate environment risk may raise default risk and ultimately provoke creditors to enhance their required returns. Furthermore, our findings also are consistent with the viewpoints of stakeholders and ethical theories.
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U2 - 10.1002/jtr.2392
DO - 10.1002/jtr.2392
M3 - Article
AN - SCOPUS:85088564046
VL - 23
SP - 56
EP - 69
JO - International Journal of Tourism Research
JF - International Journal of Tourism Research
SN - 1099-2340
IS - 1
ER -