Strategic Responses to the EU Emission Trading Scheme

Table of Contents

1. General Introduction

1.1 Purpose of the research

1.2 Research interest

1.3 Research question

1.4 Research objectives

1.5 Dissertation structure

2. Background on Climate Change Regulations and the EU ETS

2.1 Why Climate Change is addressed by companies

2.2 Climate Change regulations

2.2.1 The Kyoto Protocol

2.2.2 The European Emission Trading Scheme

2.3 Chapter conclusion

3. Literature Review

3.1 Conceptual studies

3.1.1 Dunn (2000)

3.1.2 Hoffman (2002)

3.1.3 Schaltegger, Burrit and Petersen (2003)

3.1.4 Boiral (2006)

3.2 Empirical studies

3.2.1 Levy and Kolk (2002)

3.2.2 Skjaerseth and Skodvin (2003)

3.2.3 Pacala and Socolow (2004)

3.2.4 Pinske and Kolk (2007)

3.2.5 Hoffmann (2007)

3.2.6 Jeswani, Wehrmeyer and Mulugetta (2008)

3.2.7 Kim (2008)

3.2.8 Lacombe (2008)

3.2.9 Pinske and Kolk (2009)

3.2.10 Rogge, Schneider and Hoffmann (2010)

3.2.11 Okereke and Russel (2010)

3.3 Analysis of the Literature Review

3.3.1 Strategic responses to Climate Change, GHG and EU ETS

3.3.1.1 Influencing Factors

3.3.1.2 Strategic Responses

3.3.2 Literature Gap

3.4 Chapter conclusion

4. Empirical Approach

4.1 Research setting

4.1.1 Industry selection

4.1.2 The Oil and Gas sector

4.2 Research approach

4.3 Research design

4.3.1 Data sampling

4.3.2 Data collection

4.3.3 Data analysis

4.4 Quality of Research: Validity, Reliability and Limitations

4.5 Chapter conclusion

5. Results

5.1 Carbon Emissions of Case Companies

5.2 Influencing Factors

5.3 Strategic Responses

5.3.1 Corporate Responses

5.3.2 Managerial Responses

5.3.3 Operational Responses

5.3.3.1 Compensation

5.3.3.1 Innovation

5.4 Additional Case Study Findings

5.5 Future Implications and Challenges

5.6 Chapter conclusion

6. General Conclusion

6.1 Dissertation Purpose and Research Question

6.2 Key Findings

6.3 Theory Contributions

6.4 Managerial Contributions

6.5 Limitations

6.6 Further Areas of Research

6.7 Critical Appraisal

Research Objectives & Topics

This dissertation aims to explore how multinational oil and gas companies respond strategically to the European Union Emission Trading Scheme (EU ETS). It seeks to bridge the existing knowledge gap by analyzing the impact of these regulations on company strategy and identifying the range of organizational, managerial, and operational responses adopted by major industry players.

• Strategic response frameworks within the oil and gas sector
• Impact of regulatory pressure and economic factors on corporate strategy
• Managerial adaptations to carbon pricing and environmental risk management
• Operational innovations, including CC&S and biofuels
• Strategic implications of potential carbon and investment leakage

Excerpt from the Book

Summary of Chapters

1. General Introduction: Introduces the research purpose, interest, and the exploratory approach taken to study strategic responses in the oil and gas industry.

2. Background on Climate Change Regulations and the EU ETS: Provides an overview of global climate policies, specifically the Kyoto Protocol and the mechanisms of the EU ETS.

3. Literature Review: Synthesizes existing academic conceptual and empirical research to establish a framework for understanding corporate strategic responses.

4. Empirical Approach: Describes the methodology, focusing on a multiple case study approach involving BP and Shell to gather empirical evidence.

5. Results: Details the findings regarding the carbon emissions of case companies and analyzes their corporate, managerial, and operational strategic responses.

6. General Conclusion: Summarizes the key research findings, theoretical and managerial contributions, and suggests potential areas for future research.

Keywords

EU ETS, Oil and Gas Industry, Climate Change, Carbon Trading, Strategic Response, Greenhouse Gas Emissions, Corporate Strategy, Managerial Responses, Operational Responses, Carbon Leakage, Investment Leakage, Innovation, Compensation, Environmental Management, Sustainability.

Frequently Asked Questions

What is the core subject of this dissertation?

The thesis investigates how large multinational oil and gas companies develop and implement strategic responses to comply with the European Union Emission Trading Scheme (EU ETS).

What are the primary themes discussed?

The research explores the influence of regulatory pressure, competitive dynamics, and economic factors on corporate behavior regarding climate change, specifically focusing on corporate, managerial, and operational responses.

What is the main research question?

The dissertation is guided by the question: "How do multinational oil and gas companies strategically respond to the EU ETS?"

Which methodology is applied?

The study utilizes a qualitative, exploratory multiple case study approach, conducting expert interviews at BP and Shell and utilizing data from the Carbon Disclosure Project.

What is covered in the main body of the work?

The main sections cover a literature review of climate change strategies, an empirical analysis of specific corporate, managerial, and operational responses, and an examination of future implications like carbon leakage.

Which keywords summarize this research?

Key terms include EU ETS, Oil and Gas industry, carbon trading, carbon leakage, strategic response, and corporate environmental management.

How do oil and gas companies typically manage carbon risk?

Companies integrate environmental risk management systems and internalize projected carbon costs into their financial planning and investment appraisal processes to maintain competitiveness.

What is the significance of the findings regarding carbon leakage?

The study identifies "investment leakage"—where new investments are redirected to non-EU regions due to regulatory uncertainty—as a more probable strategic outcome than the immediate relocation of existing production facilities.