Do Firms Walk the Climate Talk?

8 Pages Posted: 7 Feb 2022 Last revised: 29 Aug 2023

See all articles by Michał Dzieliński

Michał Dzieliński

Stockholm Business School, Stockholm University

Florian Eugster

University of St. Gallen - Institute of Accounting, Control and Auditing; Swiss Finance Institute

Emma Sjöström

Stockholm School of Economics

Alexander F. Wagner

University of Zurich - Department of Finance; Centre for Economic Policy Research (CEPR); European Corporate Governance Institute (ECGI); Swiss Finance Institute

Date Written: August 29, 2023

Abstract

Managers talk more about the climate on earnings conference calls when climate matters are more material for a firm. However, there is also large unexplained variation in climate talk. We find that this extra climate talk is negatively related to the change in CO2 emissions in the years after the call. However, this does not hold in the US, individualistic cultures, and cultures characterized by short-term horizons. In those settings, stock prices also react negatively to climate talk. Overall, these results suggest that firms walk the climate talk on average, but the credibility of such talk varies across firms.

Keywords: climate talk, earnings calls, sustainability, CO2 emissions, greenwashing

JEL Classification: D83, G14, G34, G41, Q54

Suggested Citation

Dzieliński, Michał and Eugster, Florian and Sjöström, Emma and Wagner, Alexander F., Do Firms Walk the Climate Talk? (August 29, 2023). Swiss Finance Institute Research Paper No. 22-14, Available at SSRN: https://ssrn.com/abstract=4021061 or http://dx.doi.org/10.2139/ssrn.4021061

Michał Dzieliński (Contact Author)

Stockholm Business School, Stockholm University ( email )

Kräftriket 7
Stockholm, 106 91
Sweden

HOME PAGE: http://www.sbs.su.se/en/

Florian Eugster

University of St. Gallen - Institute of Accounting, Control and Auditing ( email )

St.Gallen, 9000
Switzerland

Swiss Finance Institute ( email )

c/o University of Geneva
40, Bd du Pont-d'Arve
CH-1211 Geneva 4
Switzerland

Emma Sjöström

Stockholm School of Economics ( email )

PO Box 6501
Stockholm, 11383
Sweden

Alexander F. Wagner

University of Zurich - Department of Finance ( email )

Plattenstr 32
Zurich, 8032
Switzerland

Centre for Economic Policy Research (CEPR) ( email )

London
United Kingdom

European Corporate Governance Institute (ECGI) ( email )

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

Swiss Finance Institute ( email )

Switzerland

HOME PAGE: http://www.alex-wagner.com

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