The effect of climate change attitude of society on firms' environmental performance

Abstract

This article examines to what extent climate change attitude of society influences firms’ environmental performance, and if this differs between multinational firms and non-multinational firms. Additionally the relationship between human capital and firms’ environmental performance is investigated, and if this effect is moderated by climate change attitude of society. Climate change attitude of society is constructed from items of the European Social Survey 2016 and firms’ environmental performance is obtained from Thomson Reuters ASSET4. In total there is data available of 842 firms from 14 European countries. In this research a multilevel analysis is conducted. The main results show that when society thinks climate change is important, firms within this country have (in general) a higher environmental performance. This relationship is the same for multinational firms and non-multinational firms. A higher extent of human capital in countries where society thinks climate change is important, results (overall) in lower environmental performance of firms. The opposite holds for a society that thinks that climate change is unimportant. In these countries a higher extent of human capital results (in general) in a higher firms’ environmental performance.