FFA Working Papers 6:005 (2026)5

Carbon Neutrality Commitment Announcements and Subsequent Stock Returns

Michal Vyletelka

Faculty of Finance and Accounting, Prague University of Economics and Business

This paper investigates the reaction of the stock market to corporate carbon neutrality (CN) announcements using a global dataset of 887 earnings call disclosures between 2019 and 2024. Employing event-study style comparisons, industryadjusted returns, and Fama–French factor models, the analysis reveals that CN commitments have limited short-term effects, but are associated with statistically significant negative abnormal returns over a 12-month horizon. The results suggest that investors perceive carbon neutrality pledges as credible signals of future cost burdens rather than value-enhancing strategies. The findings also highlight sectoral and temporal heterogeneity: technology, energy and materials firms exhibit positive return premia, while utilities and real estate underperform; longer-dated CN commitments (post-2040) are priced more favorably than near-term commitments. Regional effects largely disappear once the sector composition is controlled, underscoring the primacy of industry dynamics in shaping market responses.

Keywords: Carbon neutrality; ESG disclosure; stock returns; event study

Received: January 9, 2026; Revised: August 24, 2026; Accepted: September 30, 2026; Prepublished online: September 30, 2026; Published online: January 22, 2026  Show citation