Quantitative Analysis of Carbon Pricing Impact on Corporate Finance and Investment Planning
摘要
With growing climate demands and the changing legislative frameworks, there is a rising need in corporations to recognize the strategic and financial implications of carbon pricing. With the maturity of regulatory systems around the world, companies are being forced to reconsider financial processes and the direction of long-term investment strategies, so that they take into consideration the cost of carbon. New tools like Carbon Emissions Trading Systems (ETS), Carbon Border Adjustment Mechanisms (CBAM) or Internal Carbon Pricing (ICP) are having crucial impacts on redistributing capital amounts, debt itemization, and cash in returns on investment. Not only are these mechanisms impacting on the structure of costs but also they are getting ingrained into corporate financial measures. The recommended study proposes the introduction of the quantitative model to assess the influence of carbon pricing on major financial measures, such as liquidity ratios, elasticity of investment, Net Present Value (NPV) of a project, and Weighted Average Cost of Capital (WACC) in different scenarios of carbon pricing. It offers a solution to consider two models, one without any carbon limits (corporate finance model) and another one with carbon considerations (carbon-integrated), in the form of carbon liabilities and compliance offsets. It is implemented through the financial stress-testing with Monte Carlo estimations, regression quantifiers and modelling of marginal abatement cost curves (MACC), which can be used to determine the capital exposure and financial buffer strength. Such instruments as Green Bonds, Carbon Forward Contracts, and ESG-Linked Financing are added to the ecosystem of the model to create a realistic environment of investing activities. The simulation results indicate the major difference in financial exposure that the carbon-intensive sectors have compared to the low-carbon portfolios. The results allow the companies to evaluate transition risk and design financial resourcefulness to align with decarbonisation requirements. The intended analysis provides practical information in risk-based investment planning in dynamic carbon policy frameworks.