Energy transition and non-energy firms’ financial performance: Do markets value capability-based energy transition strategies?

Date

2024-08-01

Author

Sirin, Selahattin Murat
Yılmaz, Berna Nisa

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This work is licensed under a Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International License.

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Energy transition has become a major challenge that will shape the global agenda in the coming decades. In addition to governments and major energy firms, non-energy firms also play a significant role in the energy transition with their growing share in renewable energy supply and other pro-environmental investments. Using the Resource-based View and Dynamic Capabilities perspectives, we discuss non-energy firms’ capability-based energy transition strategies and explore the channels through which these strategies affect their financial performance. We test our hypotheses using S&P 500 firms’ data and show that capability-based energy transition strategies have had a positive moderating effect on the relationship between the renewable energy sector performance and non-energy firms’ financial performance in the short term. Furthermore, these strategies have had a positive moderating effect on the relationship between fossil fuel prices and non-energy firms’ financial performance in the long term. Our findings indicate that capability-based energy transition strategies created a virtuous investment–return opportunity for non-energy firms between 2009 and 2021.

Subject Keywords

Business, Energy transition, Financial performance, Strategy, Sustainability

URI

https://www.scopus.com/inward/record.uri?partnerID=HzOxMe3b&scp=85195171035&origin=inward
https://hdl.handle.net/11511/110226

Collections

Department of Business Administration, Article