Does global climate risk encourage companies to take more risks?

Xu, Weidong; Gao, Xin; Hao, Xu; Li, Donghui

doi:10.1016/j.ribaf.2022.101658

Cited by 26 publications

(11 citation statements)

References 60 publications

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“…Researchers also used four other measures of firm risk‐taking for sensitivity testing. First, the standard deviation of ROA which is denoted by Crt2 (Baird & Thomas, 1985; Boubakri et al, 2013; Đặng et al, 2021; Faccio et al, 2016; Firdaus & Adhariani, 2017; Sakawa et al, 2021; Xu et al, 2022). Second, the difference of maximum and minimum value of adjusted‐ROA, denoted by Crt3 (Zhou et al, 2022).…”

Section: Hypothesis Developmentmentioning

confidence: 99%

“…Second, the difference of maximum and minimum value of adjusted‐ROA, denoted by Crt3 (Zhou et al, 2022). Third, the difference of maximum and minimum value of ROA and is denoted by Crt4 (Đặng et al, 2021; Xu et al, 2022). Fifth, ratio of the research development expense to asset as denoted by Crt5 (Harjoto & Laksmana, 2018; Shen et al, 2022).…”

Section: Hypothesis Developmentmentioning

confidence: 99%

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Corporate waste disclosure, risk‐taking and foreign ownership: Evidence from Indonesia

Wulansari

Adhariani

2023

Bus Strat Dev

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The role of corporations in waste management can reflect the superior performance in innovation and the risk a company is willing to take to engage in the circular economy. The superior performance of corporate waste management can be reflected in the corporate disclosure as a media of accountability and transparency. This research investigates the association between waste disclosure and corporate risk-taking and the moderating role of foreign ownership in companies in Indonesia as an emerging country struggling to find an effective solution toward environmental problems, including waste. The observation was performed on non-financial companies listed on the Indonesian Stock Exchange for the period 2018-2021. Panel regression was used to find the answers to the research questions of the direct and moderate associations among corporate waste disclosure, risk-taking and foreign ownership. The results show that waste disclosure encourages increased corporate risk-taking, which means that companies that disclose waste are companies with good accountability and environmental performance and tend to take risks that can increase value. Foreign ownership was not found to statistically strengthen the relationship between waste disclosure and corporate risk-taking, which is different from the expectation that improving the transparency of waste information can attract a greater inflow of foreign investor resources. This brings implication that investors need to increase attention to the issue of corporate waste management and put pressure on companies to provide information on corporate waste performance for investment decision-making. Furthermore, the results of the study also found that waste disclosure in Indonesia is still low compared to the international disclosure standard. This research contributes to the sustainability accounting literature in developing countries by outlining the role of waste disclosure.

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Section: Hypothesis Developmentmentioning

confidence: 99%

Section: Hypothesis Developmentmentioning

confidence: 99%

Corporate waste disclosure, risk‐taking and foreign ownership: Evidence from Indonesia

Wulansari

Adhariani

2023

Bus Strat Dev

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“…And these studies find that climate policy uncertainty has a negative impact on micro behavior. In addition, there is little research exploring the positive impact of climate policy uncertainty (Bell & van Vuuren, 2022; Xu et al, 2022). Few studies consider the impact of climate policy uncertainty on corporate green innovation performance.…”

Section: Introductionmentioning

confidence: 99%

Climate policy uncertainty and corporate green innovation performance: From the perspectives of organizational inertia and management internal characteristics

Huo

Liu

2023

Manage Decis Econ

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The impact of policy uncertainty caused by climate change has attracted widespread attention, but there are few studies on the relationship between climate policy uncertainty and corporate green innovation performance. This paper uses a sample of the A‐share listed companies in Shanghai and Shenzhen from 2007 to 2020 to explore the impact of climate policy uncertainty on corporate green innovation performance. And this paper also studies the moderating effect of organizational inertia and the joint moderating effects of managerial openness and organizational inertia, as well as managerial risk‐taking propensity and organizational inertia. The results show that climate policy uncertainty positively affects corporate green innovation performance. And organizational inertia can positively moderate the impact of climate policy uncertainty on corporate green innovation performance. Besides, managerial openness and organizational inertia, as well as managerial risk‐taking propensity and organizational inertia, jointly moderate the impact of climate policy uncertainty on corporate green innovation performance. When both managerial openness and organizational inertia are higher, the positive impact of climate policy uncertainty on corporate green innovation performance is the strongest. When both managerial risk‐taking propensity and organizational inertia are lower, the positive impact of climate policy uncertainty on corporate green innovation performance is the weakest.

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“…Extreme weather can affect the labor productivity of companies and damage their fixed assets and equipment. Moreover, the risk of climate change can bring potential negative impact on business development and social economy, and expose business development to greater uncertainty (Zhu et al 2021;Xu et al 2022). In this context, it is difficult to continue the business model of ignoring the impact of climate change.…”

Section: Internal Carbon Pricing and Carbon Reduction: Literature Reviewmentioning

confidence: 99%

How the Implementation of Internal Carbon Pricing Impacts on Carbon Reduction: Facilitating or Hindering

Qin

Wang

Pan

2023

Preprint

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A growing number of companies are incorporating internal carbon pricing into their climate management strategies, making it one of the ways in which the private sector can combat carbon emissions and respond to the climate crisis. In this study, we used the synthetic control method in an attempt to discover whether the implementation of internal carbon pricing has an impact on the carbon reduction of typical firms at an individual level. As some of the firms cannot be properly fitted, statistical approaches were then applied to the S&P 500 constituent firms to test if there is any correlation between the emission cuts and internal carbon pricing. We also conducted a channel analysis and found that internal carbon pricing affects the amount of carbon emissions by firms mainly through two channels, namely the level of energy intensity and R&D investments. Among them, the energy intensity plays a positive mediating role between emission reduction and internal carbon pricing. As to another channel, contrary to expectations, internal carbon pricing, to some extent, suppresses the R&D investments which will promote carbon emission reduction. That is, the size of R&D investments has masking effects in the relationship between emission cuts and internal carbon pricing. Our findings contribute to researches on the carbon pricing, emission reduction and climate management efforts from the private sector, and have implications for practices.

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Does global climate risk encourage companies to take more risks?

Cited by 26 publications

References 60 publications

Corporate waste disclosure, risk‐taking and foreign ownership: Evidence from Indonesia

Corporate waste disclosure, risk‐taking and foreign ownership: Evidence from Indonesia

Climate policy uncertainty and corporate green innovation performance: From the perspectives of organizational inertia and management internal characteristics

How the Implementation of Internal Carbon Pricing Impacts on Carbon Reduction: Facilitating or Hindering

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