Navigating the green maze: Understanding the challenges and implications of sustainability related “green” entrepreneurial acquisitions

'Go green or go home' is a message that companies are increasingly facing as investors and consumers expect firms to ramp up their sustainability efforts. While companies can build ESG capabilities internally, they can also attempt to buy them externally through so called green mergers and acquisitions.

In 2021, ESG-related acquisitions made up around 22% of all merger and acquisition deals worldwide. Their annual volume has increased by 60% between 2011 and 2021, with accelerating activity in the past three years.

The aim of this project is to deliver theoretical and practical implications on how acquiring firms can more effectively identify, value, acquire and adopt ESG practices through acquisitions in their quest to become greener.

We want to understand how managers and stakeholders from both acquiring and target firms perceive and navigate the pre- and post-merger and acquisition processes. Specifically, we want to explore their actions and reasoning during these phases, and examine the financial, strategic, and ESG-related outcomes of so-called green entrepreneurial acquisitions for both acquirers and targets.

The project is a global collaboration between leading business schools across three continents: Hanken School of Economics, Saïd Business School at University of Oxford, and Bryan School of Economics, University of North Carolina at Greensboro. The project will last three years.