Oil price uncertainty and corporate carbon performance: An international investigation

Drawing on legitimacy theory and stakeholder theory, this study examines whether oil price uncertainty (OPU) affects corporate carbon performance (CCP) in the international context. Based on data extracted from CDP (previously known as the Carbon Disclosure Project), World Bank, and Thomson Reuters Eikon databases, the study's sample consists of 9074 firm-year observations over the period 2011–2018 for all non-financial multinational companies invited to take part in the CDP questionnaire. Using an ordinary least squares regression model, we identify a strong relationship between OPU and carbon emissions performance. Our findings are robust to a battery of sensitivity tests, all of which support our original results. This study contributes new knowledge regarding the influence of OPU on CCP. The results will be of interest to investors and policymakers as they provide a useful basis for understanding OPU and its impact on CCP to promote better decision-making.