Real effects of climate policy: Financial constraints and spillovers

Bartram, Söhnke M.; Hou, Kewei; Kim, Sehoon

doi:10.1016/j.jfineco.2021.06.015

Cited by 306 publications

(42 citation statements)

References 62 publications

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“…Our results regarding credit analysts and investors are consistent with their findings regarding firms' reactions. In terms of managerial actions, Bartram, Hou, and Kim (2021) provide evidence that differences across states in their regulatory risk can have real consequences due to firms' regulatory arbitrage and Dai, Duan, Liang, and Ng (2021) show that firms outsource their emissions due to increases in state regulatory enforcements. Ginglinger and Moreau (2019) provide evidence that firms reduced their leverage after the Paris Agreement driven by both their demand for debt and lenders' capital supply.…”

Section: Introductionmentioning

confidence: 99%

Climate Regulatory Risks and Corporate Bonds

2020

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Section: Introductionmentioning

confidence: 99%

Climate Regulatory Risks and Corporate Bonds

2020

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“…The contribution of our study is threefold. First, it adds to the burgeoning research on the economic consequence of climate change (Stern 2007 ; Weitzman 2014 ; Nordhaus 2017 ; Lemoine 2021 ; Bartram et al 2021 ). We provide micro-level evidence showing that firms with more extensive discussions about the climate risk in their performance briefings experience a greater stock price decline over a short window.…”

Section: Introductionmentioning

confidence: 99%

Corporate climate risk and stock market reaction to performance briefings in China

Xiao

Liu

et al. 2022

Environ Sci Pollut Res

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This study aims to enrich our understanding of the valuation consequence of climate risk in financial markets. The primary focus of our study is on the stock price reaction to firms’ climate-risk-related information. We employ transcripts of Chinese listed firms’ performance briefings to capture the climate risk at the firm level. Using a sample of Chinese listed firms between 2009 and 2021, we find that greater corporate climate risks lead to negative market reactions over a short time window, consistent with the market quickly comprehending corporate climate risks. This result holds for a series of robustness checks. We further find that the negative impact of corporate climate risk on the stock price reaction operates through the increased market trading activities, greater investor attention, and reduced positive media coverage. Finally, we demonstrate that industry carbon emission, local abnormal temperature, state ownership, institutional shareholding, and dividend payout are important moderators that shape the association of the corporate climate risk and the adverse market reaction. Our evidence suggests that disclosures of climate-related information can help the stock market to price climate risk more efficiently.

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“…Our research contributes to a better understanding of the implications of global climate policy actions on investors' behavior, with findings being consistent-but not overlapping-with a number of recent studies. The importance of a coordinated global policy is underlined in Bartram et al (2021), who show that local climate policies are likely to fail due to the possibility of firm reallocation when environmental policies are only local. However, they do not explore the effects of the increased uncertainty about the viability of climate policies brought about by one of the key policy participants deciding to renege.…”

Section: Introductionmentioning

confidence: 99%