@conference{paltalidis_4145,
title = {Political Lobbying and Firms' Decoupling},
author = {Nikos PALTALIDIS and Vangelis Souitaris and Geoff Wood},
url = {http://www.hfaa.gr/wp-content/uploads/2025/12/program-2025-%CE%A4%CE%95%CE%9B%CE%99%CE%9A%CE%9F.-.pdf},
year = {2025},
date = {2025-12-01},
booktitle = {Hellenic Finance and Accounting Association},
address = {Athens, Greece},
abstract = {We present empirical evidence that intensive corporate lobbying functions as a powerful mechanism and channel for firms to maintain or increase Scope 1 carbon emissions while publicly claiming ambitious climate targets, effectively engaging in environmental deceptive decoupling. An increase in political lobbying intensity is associated with substantially higher emissions the following year. Using a novel deep learning model that extracts and quantifies carbon-emission commitments and target-achievement claims directly from firms' quarterly earnings-call transcripts, we show that political lobbying is one of the strongest negative predictors of actually meeting either rigorous third-party (MSCI-rated) or self-reported climate targets, reducing fulfillment probability by up to 54 percentage points. We also find that Democratic presidencies sharply reduce economy-wide emissions intensity and amplify the effectiveness of genuine target achievement, yet politically active firms respond by intensifying their decoupling precisely when regulatory threat is highest. In contrast, higher institutional ownership strongly promotes target fulfillment of real emissions reductions. Framing these patterns through deceptive decouple-induced rent-seeking theory, we argue that firms expend resources on lobbying not for productive innovation but to secure regulatory protection that allows them to preserve profits by avoiding costly decarbonization, undermining climate policy and distorting competition, while eroding trust in corporate climate commitments.},
note = {December 19-20, 2025 in Athens Greece},
keywords = {},
pubstate = {published},
tppubtype = {conference}
}
