Driving decarbonization? Corporate responses to the Paris climate agreement in the global automotive sector

Did firms accelerate decarbonization as a result of the 2015 Paris Agreement, particularly in industries where low-carbon options were technologically feasible? Paris marked a milestone in climate cooperation, but its effectiveness depends on the behavior of firms, which generate most global carbon emissions. Prior studies disagree on whether international agreements influence corporate action, and few analyze climate accords directly. This paper examines whether the Paris Agreement shifted corporate strategy in “convertible” industries, focusing on the automotive sector. Our analysis covers twelve global automakers, responsible for almost 80% of worldwide vehicle production, using six categories of primary evidence to assess strategic change. We find only limited evidence of decarbonization strategies tied to the Paris Agreement, suggesting that firm responses were at best incremental rather than transformative. These findings challenge optimistic accounts of the Paris Agreement's influence and call for continued efforts to understand the limits of international agreements in driving firm behavior to address climate change.