RT info:eu-repo/semantics/article T1 The impact of environmental performance on stock prices in the green and innovative context A1 Castro Castro, Paula A1 Gutiérrez López, Cristina A1 Tascón Fernández, María Teresa A1 Castaño Gutiérrez, Francisco Javier A2 Economia Financiera y Contabilidad K1 Economía K1 Empresas K1 Finanzas K1 Environmental performance K1 Stock prices K1 Renewable energy K1 Foreign trade K1 European listed firms K1 5308 Economía General K1 5311 Organización y Dirección de Empresas AB This study examines the impact of environmental performance on firms' stock prices, considering the moderating effect of the green and innovative environmental context by country. Renewable energy policies, green technologies, and foreign trade form this environmental context of interest for the reduction of carbon emissions. Using a sample of 2638 firm-year observations for the firms listed in the main stock index of 16 European countries over the period of 2005–2017, we find that environmental performance is value-relevant, except during the worst years of a crisis, when it is not significant. Two elements of the green technological framework, namely, renewable energy policies and the potential transmission effect of technology through foreign trade, are valued by investors as offsetting factors of the positive effect exerted by carbon performance on the firm's value. This is consistent with the slow and costly adoption of greener technologies. However, registered green patents appear to be a turning point, showing a significant positive effect on the relationship between firms' environmental performances and their market values. Again, the crisis period interferes with deepening the negative effect of renewable energy policies and cancelling out the effect of green patents and foreign trade. On one hand, our results highlight the market's role in making inefficiencies visible and showing the potential future losses of green and innovative policies; on the other hand, the hampering interference of crisis periods must be considered by policymakers. PB Elsevier SN 0959-6526 LK http://hdl.handle.net/10612/14319 UL http://hdl.handle.net/10612/14319 NO . DS BULERIA. Repositorio Institucional de la Universidad de León RD 29-mar-2024