CARBON SURCHARGES ON AIR TRAVEL BUDGETS: PEER VISIBILITY EFFECTS IN PAKISTANI MULTINATIONALS

Abstract

The paper analyses the effects of carbon surcharges to the budgets of air travelling in multinational corporations in Pakistan, by going to peer visibility effect. it is aimed that the paper will determine how the visibility of the cost of carbon emission to its competitors in the corresponding industry will affect the decisions made by firms on the distribution of its resources on the aspect of travelling. The research is a quantitative study and it makes use of archived corporate data and survey data. This question is going to be answered by the study: what influence has the peer visibility of carbon surcharges on the way that the Pakistani multinationals allocate their air traveling budgets i.e., are the firms that face the peer pressure more likely to tighten their overspending or is it going to become more efficient? The study relied on the application of cross-sectional approach to survey since it involved survey interviews through questionnaire administration to 120 managers in different multi-national corporations that are established in Pakistan. The results of the research were acquired on transparency of carbon surcharge, travel policy of corporations, and budget funding approach. It was with the help of the regressive models that the statistical analysis of the hypotheses was conducted. The results pointed out that the relationship between peer visibility and degrading budgeted air travels due to interconnectedness of carbon surcharges was high. More specifically, the constituent firms with larger exposure towards peer visibility (i.e., those which pertain to more competitive industries) were likely to maintain low travelling costs. The research contributes to the understanding of environment and financially decision making of companies with the corollaries that the peer visibility is a necessity to establish how the corporation is going to respond to environmental cost such as carbon surcharges. The given work is the first one which succeeded in analysing the phenomenon of peer visibility in the area of the carbon surcharges on the travel stipends in the context of Pakistani multinational firms.