A Study on the Impact of Carbon Emission Trading on Corporate Carbon Performance

Under the dual pressure of dual-carbon targets and high-quality economic development, the question of whether carbon emissions trading can promote the coordinated development of enterprise economy and emission reduction by improving corporate carbon performance is an urgent question to be answered. This study takes the pilot of carbon emission trading as a natural experiment. Based on the data of listed industrial enterprises in Shanghai and Shenzhen stock markets from 2008 to 2020, a multi-period difference-in-difference model is applied to study the micro-effects of carbon emissions trading mechanism on corporate carbon performance, and its action mechanism, heterogeneity, spillover effect, and cross-regional transfer phenomenon is analyzed. It is found that carbon trading significantly improves corporate carbon performance by stimulating green innovation. The effectiveness of the improvement is further enhanced by the market mechanisms, such as the liquidity and relative market size of the carbon trading market, as well as the cost-shifting ability of firms. Additionally, non-market mechanisms, such as government environmental concerns and carbon emission reduction pressure, effectively reinforce the impact of carbon trading. The impact of carbon emission trading on corporate carbon performance is particularly pronounced in carbon markets with auction-allocation, heavily-polluting industries, and robust environmental enforcement. There is no significant industry spillover effect, spatial spillover effect, or cross-regional transfer phenomenon for the improvement effect of carbon emissions trading on corporate carbon performance. This study expands the research on the consequences of carbon emissions trading policy, which is of great significance to the green and low-carbon development of firms, the construction of a national carbon market, and the realization of dual-carbon targets.