Climate Change and Mutual Fund Voting on Environmental Proposals

53 Pages Posted: 1 Jan 2022 Last revised: 7 Jul 2022

See all articles by Alberta Di Giuli

Alberta Di Giuli

ESCP

Alexandre Garel

Audencia Business School

Roni Michaely

The University of Hong Kong; ECGI

Arthur Petit-Romec

Toulouse Business School

Date Written: January 1, 2022

Abstract

This paper explores whether investors’ personal experience of climate change affects their voting behavior on environmental issues. We find that fund managers exposed to abnormally hot temperatures are significantly more likely to support environmental proposals. This increased support is stronger for proposals targeting firms with greater climate risk. The effect is less pronounced for funds that are already climate-conscious (e.g., environmental-friendly funds and funds located in areas more receptive to scientific evidence of climate change). We further show that environmental proposals receive greater aggregate support when the fraction of mutual funds exposed to abnormally hot temperatures is high. Overall, we show that fund managers’ experiences and increased awareness of climate change have a positive effect on their support for environmental policies.

Keywords: Climate Change, Shareholder Voting, Mutual Funds

JEL Classification: G30, Q54

Suggested Citation

Di Giuli, Alberta and Garel, Alexandre and Michaely, Roni and Petit-Romec, Arthur, Climate Change and Mutual Fund Voting on Environmental Proposals (January 1, 2022). European Corporate Governance Institute – Finance Working Paper No. 815/2022, Available at SSRN: https://ssrn.com/abstract=3997730 or http://dx.doi.org/10.2139/ssrn.3997730

Alberta Di Giuli (Contact Author)

ESCP ( email )

Paris Campus
79, Avenue de la Republique
Paris, 75011
France

Alexandre Garel

Audencia Business School ( email )

8 Road Joneliere
BP 31222
Nantes Cedex 3, 44312
France

Roni Michaely

The University of Hong Kong ( email )

Pokfulam Road
Hong Kong, Pokfulam HK
China

ECGI ( email )

c/o the Royal Academies of Belgium
Rue Ducale 1 Hertogsstraat
1000 Brussels
Belgium

Arthur Petit-Romec

Toulouse Business School ( email )

20, bd Lascrosses
Toulouse, 31068
France

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
432
Abstract Views
1,324
rank
95,651
PlumX Metrics