Climate Values Discovery
TRR 266 Accounting for Transparency Working Paper Series No. 136
Swiss Finance Institute Research Paper No. 23-92
HKU Jockey Club Enterprise Sustainability Global Research Institute - Archive
69 Pages Posted: 10 Oct 2023 Last revised: 17 Apr 2025
Date Written: October 9, 2023
Abstract
Fund flows and capital allocations increasingly reflect values-driven, pro-social investor preferences alongside profit motives. We examine how analysts discuss values-related climate concerns in earnings calls using a computational linguistics framework. The frequency of values-oriented climate questions increased over time. Analysts do not exhibit a fixed tendency toward green issues; only 3% of the variance in climate and climate values questions stems from individual traits. Portfolios that incorporate insights from values questions earn higher returns due to investor flow effects and also exhibit better environmental performance. For analysts, specialization in climate values discovery correlates with career progression, shaping their professional trajectories.
Keywords: Climate change, earnings calls, financial analysts, value and values discovery, analyst careers
JEL Classification: G18, G32, G38, Q54, Q55
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