The economic value of corporate eco-efficiency

Abstract

european financial management, 2010 doi: 10.1111/j.1468-036x.2009.00532.x the economic value of corporate eco-efficiency nadja guenster and rob bauer maastricht university, bonnefantenstraat 2, 6211 kl maastricht, the netherlands e-mails: nk.guenster@maastrichtuniversity.nl; r.bauer@maastrichtuniversity.nl jeroen derwall maastricht university, bonnefantenstraat 2, 6211 kl maastricht, the netherlands and tilburg university, 5000 le tilburg, the netherlands e-mails: j.derwall@maastrichtuniversity.nl; jderwall@uvt.nl kees koedijk tilburg university, p.o. box 90153, 5000 le tilburg, the netherlands e-mail: c.koedijk@uvt.nl abstract this study adds new insights to the long-running corporate environmentalfinancial performance debate by focusing on the concept of eco-efficiency. using a new database of eco-efficiency scores, we analyse the relation between ecoefficiency and financial performance from 1997 to 2004. we report that ecoefficiency relates positively to operating performance and market value. moreover, our results suggest that the market’s valuation of environmental performance has been time variant, which may indicate that the market incorporates environmental information with a drift. although environmental leaders initially did not sell at a premium relative to laggards, the valuation differential increased significantly over time. our results have implications for company managers, who evidently do not have to overcome a tradeoff between eco-efficiency and financial …

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