Corporate Climate Lobbying

A frequently voiced concern is that corporate lobbying, at least in part, hinders the implementation of ambitious climate policies. We quantify anti- and pro-climate lobbying expenditures by U.S.-listed firms and identify the largest corporate lobbyists and their motives. Firms spend, on average, $267k per year on anti-climate lobbying and $195k on pro-climate lobbying. Anti-climate lobbyists have more carbon-intensive business models, whereas pro-climate lobbyists exhibit more green innovation. Firms that spend more on anti-climate lobbying earn higher expected returns, consistent with a risk-based channel. Our results support the increasingly common investor view that anti-climate lobbying represents an investment risk.