Do voluntary environmental programs reduce emissions? EMAS in the German manufacturing sector

Kube, Roland, von Graevenitz, Kathrine, Löschel, Andreas, Massier, Philipp


Abstract
Voluntary environmental management programs for firms have become an increasingly popular instrument of environmental policy. However, the literature's conclusion on the effectiveness of such programs is ambiguous, and for the European region there is a lack of evidence based on a large control group. We seek to fill this gap with an evaluation of the Eco-Management and Audit Scheme (EMAS), introduced in 1995 by the European Union as a premium certification of continuous pro-environmental efforts above regulatory minimum standards. It is more demanding than other voluntary programs due to annual public reports of the environmental performance and targets for improvements. We use official firm-level production census data on the German manufacturing sector, a major energy consumer and emitter in Europe. To account for the self-selection of firms, we combine the Coarsened Exact Matching approach with a Difference-in-Differences estimation. Our results do not suggest reductions of firms' CO2 intensity and energy intensity neither before nor after certification. Moreover, program participants do not increase renewable energy consumption or investments into the protection of the environment and climate. Our results are robust to a variety of checks and call into question the effectiveness of the EMAS program concerning these particular outcome variables.

Keywords
Voluntary Environmental Programs; Firm-level Energy Behavior; Matching Difference-in-Differences



Publication type
Article in Journal

Peer reviewed
No

Publication status
Published

Year
2019

Journal
CAWM Discussion Paper

Volume
107

Full text

Affiliation
University of Münster, Münster, Germany Centre for European Economic Research (ZEW), Mannheim, Germany Fraunhofer Center for Economics of Materials (CEM), Halle, Germany Research Institute for Global Value Chains, University of International Business a