Do Salient Climatic Risks Affect Shareholder Voting?

47 Pages Posted: 2 Aug 2021 Last revised: 24 Feb 2022

See all articles by Eliezer M. Fich

Eliezer M. Fich

Drexel University - Department of Finance

Guosong Xu

Rotterdam School of Management, Erasmus University

Date Written: February 22, 2022

Abstract

Shareholders in locations recently hit by hurricanes significantly increase their support for environmental proposals even if they never previously voted for similar initiatives. Our results show that changed perceptions of salient climate risks rather than firms’ fundamentals drive the increased support. More favorable voting following a hurricane strike has real consequences: Climate-related proposals are more likely to pass, and when they do, firm performance weakens. These findings highlight the role of investors’ climate-related risk preferences in altering their support for corporate environmental policies

Keywords: ESG, Shareholder Voting, Climate Change, Salience

JEL Classification: D72, G30, G41, Q54

Suggested Citation

Fich, Eliezer M. and Xu, Guosong, Do Salient Climatic Risks Affect Shareholder Voting? (February 22, 2022). Proceedings of Paris December 2021 Finance Meeting EUROFIDAI - ESSEC, Available at SSRN: https://ssrn.com/abstract=3895071 or http://dx.doi.org/10.2139/ssrn.3895071

Eliezer M. Fich

Drexel University - Department of Finance ( email )

LeBow College of Business
3220 Market Street – 11th Floor
Philadelphia, PA 19104
(215) 895-2304 (Phone)

HOME PAGE: http://https://sites.google.com/view/eliezerfich/home?authuser=0

Guosong Xu (Contact Author)

Rotterdam School of Management, Erasmus University ( email )

Rotterdam
Netherlands

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