We study commitments to reduce emissions by firms subject to the European Union Emission Trading System (EU ETS), the world's largest cap-and-trade program. Commitments are associated with a drop in the number of carbon allowances surrendered, consistent with firms taking actions to reduce their emissions. However, firms subsequently increase their sales of allowances on the secondary market, transferring the right to pollute to others and potentially leaving aggregate emissions unchanged.

Both the increased transparency and the institutionalization of the municipal bond market have led to dramatic declines in the profits of underwriters, especially so for those whose underwriting activity is national in scope. Using comprehensive data on all trades, all bonds, and all underwriting spreads available between 2005 and 2023, we show that underwriters facing increasingly informed investors in the primary market are unable to capture high markups from investors but are also unable to raise costs to issuers.

Throughout 2022, the Kenan Institute at UNC-Chapel Hill explored how ESG factors enter into and play a role in the decisions of corporate managers and investors. We have framed this analysis within the broader notion of “stakeholder capitalism,” a model in which business decisions reflect explicit consideration of their expected impact on a broader set of corporate stakeholders.

Companies face increasing pressure from different stakeholders to address various environmental, social and governance (ESG) issues. In their efforts to engage with these issues, they might pursue symbolic or substantive actions, either pre-emptively (proactive actions) or in response to specific targeted threats (reactive actions). Yet we know relatively little about how different stakeholders react to this repertoire of corporate actions and importantly, whether they are aligned in their reaction. We ask this question in the context of gender inequality, an issue that has become salient due to heightened societal attention thanks to the #MeToo movement.