Corporate Green Pledges

Michael D. Bauer; Daniel Huber; Eric Offner; Ole Wilms

doi:10.1093/rfs/hhag063

Corporate Green Pledges

Michael D. Bauer¹; Daniel Huber²; Eric Offner³; Ole Wilms⁴

¹ Federal Reserve Bank of San Francisco , USA; CEPR · ² Arval BNP Paribas , · ³ Frankfurt School of Finance and Management · ⁴ University of Hamburg and Tilburg University , Germany and the

Review of Financial Studies 2026 open access

Abstract We build a novel data set of time-stamped corporate decarbonization commitments—green pledges—for U.S. public firms by classifying news articles with large language models and human validation. Firms announcing green pledges tend to be larger and browner than other firms, both within and across industries. Green pledges significantly raise stock prices, consistent with a reduction in the carbon premium, and predict sizable declines in future carbon emissions and emission intensities. These effects tend to be strongest for firms in brown industries. Green pledges thus appear credible, convey relevant new information to investors, and provide meaningful financial incentives to decarbonize. (JEL G14, G32, Q54, Q56)

DOI: 10.1093/rfs/hhag063
Language: en
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