Innovate to Lobby? European Firms and Corporate Lobbying during Climate Change Regulation

Do more or less innovative firms lobby regulators about new regulatory proposals? We examine this question in the context of the European Union’s 2019 European Green Deal (EGD), which sharply increased regulatory uncertainty. We argue that while highly innovative firms may avoid lobbying due to opportunity costs and knowledge leakage risks, they are also more exposed to regulatory change—particularly when they are carbon-intensive—and thus more likely to seek policy-relevant information. Using data on 1,617 publicly listed European firms (2015–2024), we combine EU lobbying meeting disclosures with firm-level patent and carbon-intensity measures. Exploiting the unexpected elevation of climate policy in 2019, we show that green lobbying increased sharply after 2019 and was driven primarily by firms with larger green patent portfolios and higher carbon emissions. Our findings demonstrate that innovation and lobbying increase jointly under regulatory change, advancing research on non-market strategy and corporate innovation.