Prof. Aseem Prakash and colleague Prof. Inhwan Ko write in The Regulatory Review that business pledges to curb Green House Gasses (GHB) are not necessarily bad for the business' stock price.
Alongside government policies, many corporations have announced voluntary net-zero emission targets. For example, Amazon has pledged to reach net-zero carbon by 2040 and has launched and invited other firms to commit to zero emissions via its Climate Pledge program. The financial sector has embraced net zero commitments as well.
In contrast, critics suggest that stock markets will punish firms for proactive environmental policies because climate commitments divert resources from profit-seeking activities...third school of thought suggests that stock markets will shrug off these commitments because they think that, at best, these measures do not fundamentally change how firms do business, or at worst, constitute greenwashing.
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