Examining 13 companies in the U.S. pulp and paper sector, this report provides a new method of assessing a company’s prospective financial exposure to environmental risks that could give investors an edge when making investment decisions.
Today’s investors and companies are increasingly aware of the influence of environmental issues on the performance of their assets and businesses.
New environmental regulations, fluctuations in the availability of raw materials, and changes in consumer attitudes have all impacted financial performance.
Despite the growing importance of the environment in this context, there has been little systematic integration of environmental issues into mainstream financial and corporate decision-making. This is largely due to the lack of any feasible methodology for translating environmental performance into financial terms.
In Pure Profit: The Financial Implications of Environmental Performance, WRI economists Robert Repetto and Duncan Austin attempt to fill this gap.
An application of this methodology to 13 leading companies in the U.S. pulp and paper sector the authors demonstrate why evaluating environmental issues should be a central part of investment analysis.