Analysis of carbon credit trading (CCT) practices: a study of manufacturing organizations in British Columbia, Canada

Abstract

Purpose

Factors that affect the use of carbon credit trading (CCT) by industries include as follows: avoiding carbon taxes, international expansion, venture capital, competitive advantage and clean technology. The impact of these factors is examined here in relation to the profile of 14 Canadian organizations to investigate factors that influence CCT practices.

Design/methodology/approach

This research involves a survey of 150 employees at 14 industries in British Columbia (BC) Canada to review and analyze their perceptions of factors that impact CCT.

Findings

Results demonstrate the potential for enhancing the use of CCT by organizations. It was shown that organizations perceive that CCT enhances their competitive advantage, which is an incentive that needs further investigation as having potential for encouraging CCT and greenhouse gas (GHG) reduction.

Research limitations/implications

Due to limited funding and workforce, as well as geographical constraints, only 14 industrial organizations were engaged in this research in BC Canada. The scope of future research needs to be enlarged by considering neighboring countries such as the USA and Mexico. This research regarding factors that impact organizations in adopting carbon crediting trading has the potential to provide and shape inter-continental comparisons.

Practical implications

This study illustrates how CCT has the potential to enhance competitive advantage and may impact the industry toward reducing GHG emissions through CCT. This concept adds a new environmental protection factor and dimension to trade and industry. As organizations plan to invest funds in different carbon reduction projects this may result in expanded employment opportunities.

Social implications

Organizations are interested in CCT but may hesitate in engaging in CCT as it can be a complex procedure. In addition to further research, workshops and seminars regarding CCT and dissemination of research should be organized by the universities, related authorities and government organizations to make CCT more known and feasible. This study shows that financial and non-financial benefits may be gained by any organization when involved in CCT. Larger advertising and information campaigns may motivate more organizations in this regard.

Originality/value

This study extends the study of Garg et al. (2017) regarding challenges for CCT practices. International Journal of Management, 10(1), 85–96. It contributes evidence that the size (revenue) of an organization does not affect the level of carbon credits traded and shows potential for smaller organizations to be encouraged to take part in CCT.

Citation

Garg, A.K., Kohli, A. and Cummings, J.B. (2022), "Analysis of carbon credit trading (CCT) practices: a study of manufacturing organizations in British Columbia, Canada", International Journal of Energy Sector Management, Vol. 16 No. 2, pp. 372-386. https://doi.org/10.1108/IJESM-01-2021-0020