Does a country's environmental policy affect the value of small and medium sized enterprises liquidity in the energy sector?

Cash management is important for energy SMEs, which, differently from large firms, face severe financial constraints and need to seize growth opportunities ensure their survival. This paper, analyzing a sample of European finds positive effect holding buffer cash on firm performance. It shows that stock allows firms prevent negative contingencies and/or achieve valuable patterns investments. Moreover, considering the industry involved in environmental sustainability policies promoted by national governments, we find complying with regulations reduces value cash. Countries pay more attention issues provide SMEs support, reducing hold A key implication that, context high concern, have flexibility guarantee externalities sector.