Institutional Investors’ Views and Preferences on Climate Risk Disclosure
63 Pages Posted: 19 Aug 2019 Last revised: 23 Feb 2020
Date Written: October 1, 2019
We survey institutional investors on firms’ climate risk disclosures. Many investors believe climate risk reporting to be as important as traditional financial reporting and that it should be mandatory and more standardized. However, they also view current quantitative and qualitative disclosure on climate risks as being insufficient and imprecise. The belief that current climate-related disclosure is deficient derives more from investors that believe climate risks are underpriced in equity markets. We complement the survey analysis with archival data showing that greater institutional ownership is associated with a higher propensity of firms to voluntarily disclose their carbon emissions.
Keywords: climate finance, climate risk disclosure, transparency, institutional investors
JEL Classification: G11, G3, Q54
Suggested Citation: Suggested Citation