The Green Transition: Evidence from Corporate Green Revenues
Working Paper Author/Authors
Key Finding
Green revenues have accelerated post Paris Agreement, led by innovative US companies, but there is modest evidence of green alpha
Abstract
We introduce a novel measure of revenues from green products and services for publicly listed firms worldwide that is not spanned by prior sustainability metrics used in the literature. We show that green revenues grew at an accelerated pace after the Paris Agreement. This growth has been driven by innovative US companies converting green patents into green revenues, as well as by firms with higher sustainability-focused institutional ownership before the Paris Agreement. Furthermore, we examine the stock returns of firms with green revenues and find modest evidence of a green alpha in the post-Paris period, primarily concentrated in US stocks.
© Johannes Klausmann, Philipp Krueger, Pedro Matos, 2025
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