Investigating the impact of carbon tax on socially responsible corporate governance: the case of South African motor vehicle manufacturers

Abstract

Socially responsible corporate governance is an essential aspect of the contemporary corporate environment, and then especially in ensuring continuous sustainable development within a South African context. As such, it also encompasses broad environmentally focused aspects. The motor vehicle manufacturing industry in South Africa was among the first to be faced with the implementation of carbon taxes. This paper explores the policy decision to implement the carbon tax within the context of socially responsible governance in the motor vehicle manufacturing industry. The research methodology applied incorporates both review of supporting literature and an exploratory empirical case study. The research suggests that the industry is cognizant of the importance of environmental damage costs and their responsibility therein, while also indicating that corporate social investment in this industry was non-responsive to the implementation to carbon tax. The results also suggest that the current carbon tax rate may be adequately priced and is an effective instrument in lowering greenhouse gas emissions.