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In this research paper, we conduct an examination of the impact of green investments on dividend policies within both polluting and environmentally friendly firms. Utilizing two distinct model assumptions, we analyze a global sample of firms from 21 countries spanning the period from 2013 to 2022 to derive our primary empirical findings and perform robustness tests. Our analysis incorporates two estimation techniques: Ordinary Least Squares (OLS) and System-GMM (Generalized Method of Moments). Our findings reveal that green investment policies have a positive influence on environmentally friendly companies while exerting a detrimental effect on the dividend distributions of polluting companies. This influence is statistically and economically significant. Furthermore, our results remain consistent when employing alternative tests based on agency costs, other stakeholders and before and during Covid-19. On the other hand, when we used system-GMM method, our results also showed that green investment policies have a positive influence on environmentally friendly companies while exerting a detrimental effect on the dividend distributions of polluting companies.
Hasan et al. (Tue,) studied this question.