TY  - UNPD
A1  - Gözlügöl, Alperen Afşin
A1  - Ringe, Wolf-Georg
T1  - Private companies: the missing link on the path to net zero
T2  - LawFin working paper ; No. 38 ; SAFE Working Paper No. 342
N2  - Global consensus is growing on the contribution that corporations and finance must make towards the net-zero transition in line with the Paris Agreement goals. However, most efforts in legislative instruments as well as shareholder or stakeholder initiatives have ultimately focused on public companies.
This article argues that such a focus falls short of providing a comprehensive approach to the problem of climate change. In doing so, it examines the contribution of private companies to climate change, the relevance of climate risks for them, as well as the phenomenon of brown-spinning (ie, the practice of public companies selling their highly polluting assets to private companies). We show that one cannot afford to ignore private companies in the net-zero transition and climate change adaptation. Yet, private companies lack several disciplining mechanisms that are available to public companies, such as institutional investor engagement, certain corporate governance arrangements, and transparency through regular disclosure obligations. At this stage, only some generic regulatory instruments such as carbon pricing and environmental regulation apply to them.
The article closes with a discussion of the main policy implications. Primarily, we discuss and evaluate the recent push to extend climate-related disclosure requirements to private companies. These disclosures would not only help investors by addressing information asymmetry, but also serve a wide group of stakeholders and thus aim at promoting a transition to a greener economy.
T3  - LawFin Working Paper - 38 
KW  - private companies
KW  - net-zero transition
KW  - climate-related disclosures
KW  - brown-spinning
KW  - climate change
KW  - private equity
Y1  - 2022
UR  - http://publikationen.ub.uni-frankfurt.de/frontdoor/index/index/docId/65250
UR  - https://nbn-resolving.org/urn:nbn:de:hebis:30:3-652509
UR  - https://ssrn.com/abstract=4065115
IS  - July 2022
PB  - Center for Advanced Studies on the Foundations of Law and Finance, House of Finance, Goethe University
CY  - Frankfurt am Main
ER  -