Firm‐Level Climate Change Exposure

2023/02/28 by Zacharias Sautner, Laurence van Lent, Grigory Vilkov +1 · 9 citations
Economics, Econometrics and Finance · #Climate Change Policy and Economics #Energy, Environment, Economic Growth #Market Dynamics and Volatility

paper · pdf · doi:10.1111/jofi.13219

openalex publication_date 2023/02/28 · openalex created_date 2025/10/10 · openalex updated_date 2026/07/30

Abstract

ABSTRACT We develop a method that identifies the attention paid by earnings call participants to firms' climate change exposures. The method adapts a machine learning keyword discovery algorithm and captures exposures related to opportunity, physical, and regulatory shocks associated with climate change. The measures are available for more than 10,000 firms from 34 countries between 2002 and 2020. We show that the measures are useful in predicting important real outcomes related to the net‐zero transition, in particular, job creation in disruptive green technologies and green patenting, and that they contain information that is priced in options and equity markets.

Citations

• Risk, Return, and Equilibrium: Empirical Tests
• On Persistence in Mutual Fund Performance
• Text as Data
• Taming the Factor Zoo: A Test of New Factors
• Firm-Level Political Risk: Measurement and Effects*
• Sustainable investing in equilibrium
• Climate risks and market efficiency
• Carbon Tail Risk
• Does Silence Speak? An Empirical Analysis of Disclosure Choices During Conference Calls
• Technological Innovation, Resource Allocation, and Growth*
• The Global Impact of Brexit Uncertainty
• Climate Finance
• Count (and count-like) data in finance
• Greenhouse Gas Disclosure and Emissions Benchmarking
• Global Pricing of Carbon‐Transition Risk
• Sources and Transmission of Country Risk

Cited by

• Climate change exposure and corporate culture: A text-based approach
• Implicit coordination in sellers’ inflation: How cost shocks facilitate price hikes
• Antecedents and Consequences of Climate Change Disclosure and Performance in the Context of Sustainable Development: A Systematic Literature Review
• Where is the carbon premium? Global performance of green and brown stocks
• Do investors care about biodiversity?
• Burn now or never? Climate policy exposure and investment of fossil fuel firms
• Carbon markets and firms’ perceived climate regulatory risk
• The macroeconomic cost of temperature risk
• Measuring Corporate Human Capital Disclosures: Lexicon, Data, Code, and Research Opportunities
• Climate change and corporate cash holdings: Global evidence

Related

• Managing Physical Impacts of Climate Change: An Attentional Perspective on Corporate Adaptation
• Automated Identification of Climate Risk Disclosures in Annual Corporate Reports
• Climate exposure drives firm political behavior: Evidence from earnings calls and lobbying data
• Estimation of Corporate Greenhouse Gas Emissions via Machine Learning
• Warning words in a warming world: Central bank communication and climate change