Exploring the Attitudes of CFOs Towards Carbon Tax Policy

ABSTRACT

While climate change is a serious concern for firms and the society, scepticism remains an obstacle in the implementation of an effective emission-reducing carbon pricing policy in many countries. The support for carbon tax as a climate policy can be influenced by interest groups that hold significant power or bear substantial costs. This study draws on the attitude–behaviour–context (ABC) framework and a survey of chief financial officers (CFOs) in Canada and the United States to explore the attitudinal orientations of CFOs towards the environment, and how these attitudes relate to support for carbon tax as a climate policy. Our study identifies four value factors (altruism, egoism, traditionalism and self-transcendence) and two belief factors (environmentalism and anti-regulation) as the attitudinal orientations of CFOs. The results of applying a partial least squares structural equation modelling (PLS-SEM), including mediation and moderated mediation models, show that certain aspects of these values and beliefs relate to support for carbon tax. The results suggest that CFOs largely support carbon tax, and thus refute the findings in prior studies that accountants are unsupportive stakeholders. The study also highlights the roles that CFOs can play, arguing that their involvement may improve consistency and accuracy in carbon accounting.

KEYWORDS:

• Carbon tax
• climate policy
• attitude–behaviour–context
• CFOs

Acknowledgements

The authors thank the Alberta CPA Education Foundation for partly funding this research. The authors also express their appreciation to two anonymous reviewers and the editor for helpful comments.

Disclosure statement

No potential conflict of interest was reported by the author(s).

Notes

1 Some of the initiatives that have focused on institutionalising disclosure of social, ethical and environmental risks within financial reporting include the American Sustainability Accounting Standard Board (SASB), the European Directive on non-financial disclosure (2014/95/EU), and the G4 guidelines issued by the Global Sustainability Standard Board (GSSB), among others (Jebe 2019; Truant, Corazza, and Scagnelli 2017).

2 While we draw on prior studies to classify political affiliation and trust in authority as contextual factors in this study, we recognise that personality traits may influence political affiliation and perception of trust in authority.

3 An industry dummy is also examined in additional analysis.

4 This selection criterion is contained in the research firm’s engagement contract.

5 See Wieland et al. (2017).

6 We define traditional CFOs as those who are primarily interested in the satisfaction of basic needs (physiological and safety) as indicated by the importance they attach to family security and enjoyment of life.

Additional information

Funding

This work was supported by CPA Education Foundation Alberta (https://www.cpaalberta.ca/Foundation).