Greener production after foreign acquisitions

News

Foreign investments are linked to lower carbon and energy intensities of Swedish firms, facilitating the green transition. This is shown in a new report by the National Board of Trade Sweden.

Carbon dioxide and energy intensities during production are lower for foreign-owned Swedish firms. This result, which is even stronger for highly carbon- and energy-intense firms, is an indication of a positive relationship between sustainability goals and foreign direct investment. This report also shows that the level of carbon or energy intensity of the Swedish firms is not a significant predictor of foreign acquisition, as greener firms are not more likely to be acquired than non-green firms.

“Sweden’s goal to achieve a net-zero economy by 2045 requires significant investments. In this report, we find that Swedish firms have lower carbon and energy intensities in their production after foreign acquisition. This conclusion coincides with the goals of the recently published Clean Industrial Deal by the European Commission”, says Erik Merkus, trade policy adviser at the National Board of Trade.

The report reiterates the importance for Sweden to maintain its open and transparent investment climate to support the green transition and competitiveness. It was already known that foreign investments potentially have economic benefits, but our new report shows that these benefits may even be present in the environmental realm. This should be positive news in our efforts to achieve the global sustainability goals.

Read the full interview and download the report

The Impact of Foreign Acquisitions on Swedish Firms’ Carbon Emissions and Energy Use