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Published on: June 12, 2016
The impact of climate policy uncertainty on green mergers and acquisitions
Ping Yang1, Ahmed Imran Hunjra2, David Roubaud3
1School of Economics and Management, Xinjiang University, Urumqi, 830047, China.
Abstract:
Green mergers and acquisitions (GM&A) represent a critical strategy for firms to align with environmental constraints objectives of sustainable development. This paper leverages data from A- -share listed companies spanning 2007 to 2021 to examine the impact of climate policy uncertainty (CPU) on green mergers and acquisitions activities and their underlying mechanisms. This paper reveals that climate policy uncertainty catalyzes green mergers and acquisitions, with a pronounced effect observed among non-state-owned enterprises, firms within the non-energy sector and high-tech sector. Climate policy uncertainty primarily applies pressure on companies through increased external regulatory constraints and internal operational challenges, thereby compelling firms to engage in green mergers and acquisitions. Further analysis dispels the notion that green mergers and acquisitions driven by climate policy uncertainty is merely a "greenwashing" tool; instead, climate policy uncertainty effectively promotes substantive green transformation. This paper enriches the literature on the driving factors of green mergers and acquisitions in the lens of climate policy uncertainty and provides strategic insights for government bodies aiming to encourage firms toward sustainable development.
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