Preliminary Conference Programme

Do public policies necessarily foster private-sector prosocial behaviour? Using the adoption of greenhouse gas emissions reduction targets across nine U.S. states as an empirical setting, I find that firms in adopting states exhibit weaker voluntary motives to reduce emissions, as reflected in fewer emissions-related shareholder proposals and lower voting support. Despite policy incentives, these firms do not achieve greater emissions reductions relative to their peers. The policy is least effective for firms with stronger pre-policy voluntary motives, consistent with a crowding-out mechanism. Overall, the findings suggest that when public policy crowds out private-sector voluntary motives, it may undermine policy effectiveness.

Despite the diffusion of sustainability as a legitimate strategic logic, evidence of its impact on firm value remains tentative. Current scholarship provides limited strategic guidance on how firms should adapt their behavior as systemic boundaries become more salient. This paper bridges this gap by developing a framework that links the value of sustainability strategies to their ability to manage a multi-level feedback loop between firm operations and systemic outcomes. We posit that firms must develop strategic complexity, the degree of sophistication of their strategies in terms of the breadth of implied sustainability behaviors, to match the systemic complexity of their environment. Due to organizational costs, this relationship follows an inverted U-shape. Furthermore, we hypothesize that this curve shifts when exogenous shocks alter systemic complexity. To test these predictions, we apply a hierarchical Bayesian model to a dataset of over 200000 sustainability initiatives by 1186 firms to measure the complexity of their enacted strategies. Our empirical design leverages the European Union's "Fit for 55" policy as a quasi-natural experiment. Our results support both hypotheses: we find a curvilinear relationship between strategic complexity and firm financial value, and show that the curve shifts toward higher complexity for EU firms following the regulatory shock.

U.S. federal and state biofuel policies interact in complex ways, but existing models insufficiently capture these relationships, limiting analyses and the effective design of new policies. We develop a detailed partial equilibrium model of road and air transportation fuel markets to compare policy options to incentivize the deployment of sustainable aviation fuel (SAF). We find several federal policy options to result in similar emissions reductions and costs but different incidence across jurisdictions, fuel users, and taxpayers. Our lowest cost policy scenario entails replacing current biofuels policies with a modest carbon tax on fossil transportation fuels and a SAF tax credit.