Carbon neutral announcements and Chinese stock market reaction: a supply chain network-based perspective

Weihua Liu, Zhixuan Chen, Tsan Ming Choi, Paul Tae Woo Lee, Hing Kai Chan, Yongzheng Gao

Research output: Journal PublicationArticlepeer-review


Purpose: This study aims to explore the impact of carbon neutral announcements on “stock market value” of publicly listed companies in China. Design/methodology/approach: The event study approach is adopted. Market, market-adjusted, Carhart four-factor model and a cross-sectional regression model are employed to examine the impacts of carbon neutral announcements on “stock market value” of Chinese companies based on data from 188 carbon neutral announcements. Findings: Carbon neutral announcements positively impact Chinese shareholder value. Carbon neutral announcements at the strategic level have a more positive and significant impact on Chinese stock market value. Innovative carbon neutral announcements do not significantly cause Chinese stock market reactions. Companies have more positive and significant stock market reactions when the companies make carbon neutral announcements that reflect high supply chain network resilience and heterogeneity and strong supply chain network relationships. Practical implications: The findings uncover the business value of carbon neutral activities and provide operations managers in developing countries insights into how to improve enterprises' market value by actively implementing carbon neutral activities. Originality/value: This paper is the first trial to apply an event study to examine the relationship between carbon neutral announcements and Chinese stock market value from the perspective of announcement level and type and supply chain networks. This paper introduces corporate reputation theory and enriches the application of corporate reputation theory in the field of low-carbon environmental protections and supply chains.

Original languageEnglish
JournalInternational Journal of Operations and Production Management
Publication statusAccepted/In press - 2023


  • Carbon neutral announcement
  • Chinese listed companies
  • Event study
  • Stock market reaction
  • Supply chain network

ASJC Scopus subject areas

  • General Decision Sciences
  • Strategy and Management
  • Management of Technology and Innovation


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