Does the location of a company’s global headquarters have an influence on its climate change awareness?

Abstract

This paper studies whether the location of a company’s global headquarters has an influence on its climate change awareness. The global headquarters hosting business elites from multinational companies are the surrogate indicators of the opinion leaders in the business world. At different locations, these opinion leaders receive different information from their interaction with their surroundings. The political influence, the market pressure, and the peer pressure a company receives are compared to find out what factor influences the opinions ‘leaders’ environmental attitude the most. The climate change awareness of the Fortune Global 500 companies is explored through the Carbon Disclosure Project Leadership Index (CDLI). The CDLI was compared to Yale’s country Environmental Performance Index and to the size of business clusters (the number of companies in a city). An individual study was conducted for the U.S. on its state governments’ environmental ideologies and its companies’ CDLI. The results demonstrate a noticeable correlation between the location of global headquarters and the environmental commitment of a company. Interestingly, the positive correlation between the size of clusters and CDLI at continental scale turns into a negative correlation at global scale; this finding further indicates the influence of geo-political boundaries and countries’ historic level of environmental awareness, along with a possibility of cultural influence. Meanwhile, this research discovers that the higher the revenue ranking a company has, the better CDLI it has. Geographic Information Science tools, ArcGIS and GeoDa, are used for spatial statistics analysis and visualisation, to explore the potential of GIS technology in social science projects.