Family-Controlled Firms and Environmental Sustainability: All Bite and No Bark

Families control a large swath of the world’s publicly traded firms. Do they take environmental performance seriously? We test this in a sample of 3,832 firms from 35 countries. Using carbon emissions as the sustainability metric, the performance of family-controlled firms is not worse, and in some settings is better, than that of widely held firms. Using environmental scores based on qualitative metrics, family firms perform significantly worse. Our paper provides a completely new interpretation of prior evidence that family control is negatively related to environmental performance. Family-controlled firms take carbon emissions seriously and manage this potentially existential risk well.