Environmental innovation- the missing link between environmentalism and firm value?
When:
—
Venue:
Online
We are pleased to announce the 2nd Seminar Series on Governance, Institutions, and Sustainability jointly hosted by the Centre for Political Economy and Institutional Studies and by the Birkbeck Responsible Business Centre, within the Birkbeck Business School.
In our rapidly evolving world, the intricate web connecting governance, institutions, and sustainability has become increasingly prominent. We invite scholars, researchers, and practitioners to enhance this very important debate and to join us in exploring the profound intertwining of these critical elements at our upcoming seminar series.
Abstract
Our paper provides insights into how investors can motivate managers to be more environmentally innovative through managerial incentives. We empirically document how the managerial motivating-innovation incentive scheme can be structured differently from the standard pay-for-performance one in order to motivate managers to pursue environmental innovation. Using an international dataset, we find that a positive long-term change in a company's environmental innovation enhances its market valuation. Since the effect of the long-term change is economically significant, our findings have implications for designing a specific innovation-motivating managerial incentive scheme, which links managerial behaviour with a firm's valuation. We suggest using stock options with a long vesting period can motivate managers to pursue environmental innovation
Speaker
Ellen Pei-yi Yu (Birkbeck University of London, UK)
Convener/Organiser: Dr Luca Andriani
Contact name:
Luca Andriani
- Ellen Yu (Birkbeck University of London, UK)