Please use this identifier to cite or link to this item: https://hdl.handle.net/10419/322380 
Year of Publication: 
2025
Series/Report no.: 
Working Papers No. 2025-08
Publisher: 
Banco de México, Ciudad de México
Abstract: 
Since the 2016 Paris Agreement, countries and companies have been increasingly pressured to adopt appropriate response measures to climate change. However, it is not clear what factors drive firms to undertake climate change actions. Using a correlated random effects panel probit model, this paper contributes to the literature by analyzing the influence of advances in climate policies, as measured by the Climate Change Performance Index, on firms committing to set a greenhouse gas (GHG) emissions target. We find that advances in national climate policies are associated with a higher probability of firms committing, particularly for firms in the non-financial sectors and, among them, for those that do not belong to sectors considered as the largest producers of greenhouse gas (GHG) emissions. Lastly, the availability of funding for green projects, indirectly measured by the issuance of green bonds per country, also positively contributes to the probability of firms committing.
Subjects: 
Binary response models
Climate policy
GHG emissions
JEL: 
C35
G38
M14
Document Type: 
Working Paper
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