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<p>This study examines the relationship between climate beliefs and attitudes (CBA) and corporate tax savings. We document that firms headquartered in counties with high CBA are more likely to utilize climate change-related tax incentives to reduce their tax payments. Our evidence suggests that CBA’s influence manifests as increased climate-related R&amp;D investments and corporate environmental commitments, which give rise to various investment-related tax credits, resulting in lower tax payments. Further analyses indicate that the positive relationship between CBA and corporate tax savings is more pronounced for firms in climate-vulnerable industries and those in states with climate action plans in place. Using attention-grabbing disaster events, the implementation of climate adaptation plans, and corporate headquarters relocation events, we document that heightened CBA incentivizes firms to realize greater tax benefits. Our findings present an important&#xa0;business ethics paradox: while firms in high-CBA counties genuinely invest in sustainability, they simultaneously engage in tax planning that reduces public revenue available for broader climate initiatives. This creates a tension between shareholder value maximization and responsible corporate citizenship, raising critical concerns about distributive justice and the alignment of private financial incentives with public environmental goals.</p>

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Climate Beliefs and Attitudes and Corporate Tax Savings

  • 期刊论文

  • 发表日期：

    2026年2月11日

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  • Lei Zhang,
  • Kiridaran Kanagaretnam

摘要

This study examines the relationship between climate beliefs and attitudes (CBA) and corporate tax savings. We document that firms headquartered in counties with high CBA are more likely to utilize climate change-related tax incentives to reduce their tax payments. Our evidence suggests that CBA’s influence manifests as increased climate-related R&D investments and corporate environmental commitments, which give rise to various investment-related tax credits, resulting in lower tax payments. Further analyses indicate that the positive relationship between CBA and corporate tax savings is more pronounced for firms in climate-vulnerable industries and those in states with climate action plans in place. Using attention-grabbing disaster events, the implementation of climate adaptation plans, and corporate headquarters relocation events, we document that heightened CBA incentivizes firms to realize greater tax benefits. Our findings present an important business ethics paradox: while firms in high-CBA counties genuinely invest in sustainability, they simultaneously engage in tax planning that reduces public revenue available for broader climate initiatives. This creates a tension between shareholder value maximization and responsible corporate citizenship, raising critical concerns about distributive justice and the alignment of private financial incentives with public environmental goals.