Factors Affecting the Support of Turkish Firms for the Emissions Trading System in the Context of Harmonization with the European Green Deal

Abstract

The European Union will implement a carbon border adjustment mechanism to curb carbon leakage and encourage more countries to participate in the fight against climate change. Countries trading with the Union and lacking carbon pricing policies will be subject to this regulation. Turkey, one of these countries, initiated efforts to establish an emissions trading system (ETS). This study has two objectives: The first is to investigate the environmentally sustainable practices of firms in energy-intensive industries that are likely to be regulated by the ETS. The second is to explore the determinants of support for the ETS. Our findings indicate that firms' adoption of green practices and perception of the ETS as an effective tool have a positive impact on their support for the ETS.