Family Ownership and Corporate Carbon Emissions: International Evidence on Governance and Institutional Quality

We investigate the relationship between family ownership and absolute corporate carbon emissions, with the moderating effect of internal and external governance systems. Using 24,643 firm‐year observations in 42 countries from 2010 to 2024, we find that family firms exhibit lower levels of absolute carbon emissions than non‐family firms. The results remain stable across alternative family control definitions, the percentage of family ownership, and tests addressing potential endogeneity concerns. However, the effect is not homogeneous. While internal corporate governance quality does not significantly alter this relationship, the lower carbon emissions of family firms become more pronounced in countries characterized by weaker external institutions. These findings suggest that family control can serve as an informal governance mechanism that partially compensates for weak formal institutional frameworks in countries with limited regulatory quality. Thus, our evidence is relevant to climate‐related sustainability objectives, particularly the United Nations Sustainable Development Goal (SDG) 13.