The Green Black Box: Environmental-Transition Targets and Deal-Value Transparency in Korean Cross-Border Acquisitions

Firms can use cross-border mergers and acquisitions (M&As) to obtain technologies and capabilities needed for environmental transition, yet the values of these transactions may be difficult for outside stakeholders to observe. This study examines the relationship between environmental-transition activity relevance and deal-value transparency using 209 completed acquisitions by Korean listed firms from 2016 to 2020. We identify transition-relevant targets through a prespecified activity-name crosswalk based on the Korean Green Taxonomy. The screen classifies 18 targets as transition-relevant, including three explicit environmental activities and 15 activities requiring project-level technical review. This measure captures activity relevance only and does not indicate taxonomy alignment or environmental performance. The classification shows substantial agreement with the alternative LSEG Energy and Power or Materials sector screen (Cohen’s κ = 0.669; 14 overlapping cases). Deal values were reported for 139 of 140 domestic transactions but for only 38 of 69 cross-border transactions. Given this pronounced imbalance, we employ Firth penalized logistic regression. Cross-border status is consistently associated with a lower likelihood of deal-value reporting, including in models that control for lagged acquirer size, profitability, and leverage obtained from OpenDART. Within the cross-border subsample, transition relevance is negatively associated with deal-value reporting in the baseline model, but the relationship weakens after financial controls are included. The findings therefore reveal a robust cross-border transparency gap, whereas the evidence concerning environmental-transition targets remains suggestive and sensitive to measurement and model specification. Boards and regulators should strengthen valuation documentation and governance oversight in cross-border acquisitions and use taxonomy-based screens as due-diligence tools rather than as evidence of ESG performance.