Climate risk disclosure and stock price crash risk: The case of China

Lin, Boqiang; Wu, Nan

doi:10.1016/j.iref.2022.08.007

Cited by 48 publications

(17 citation statements)

References 49 publications

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“…Moreover, strict supervision by regulatory authorities can reduce share price crashes (Luo & Du, 2014). For instance, tax monitoring can restrict aggressive tax avoidance by managers, reducing corporate stock price crashes (Lin & Zheng, 2016). State antitakeover laws curb stock price crashes (Bhargava et al, 2017).…”

Section: Literature Review and Hypothesis Developmentmentioning

confidence: 99%

CEO facial structure and stock price crash risk

Zheng

Zhong

et al. 2023

Accounting & Finance

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This study conducted an empirical analysis of a manually collected sample of chief executive officer (CEO) facial structure measurements (facial width-to-height ratio [FWHR]) to examine the relationship between FWHR and stock price crash risk. The samples were collected for the period 2008-2019 from Chinese A-share listed firms. The results revealed a positive impact of FWHR on stock price crash risk. The positive impact is more pronounced for firms in which CEOs are entrusted with greater powers, firms that appoint a higher number of independent directors, or which function in a more competitive product market. Various robustness and endogeneity tests confirm our main conclusions.

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Section: Literature Review and Hypothesis Developmentmentioning

confidence: 99%

CEO facial structure and stock price crash risk

Zheng

Zhong

et al. 2023

Accounting & Finance

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“… 2022 ), the low-carbon transformation of enterprises (Zheng et al. 2022 ), disclosure of corporate climate risks (Lin and Wu 2023 ), etc. On the other hand, the impact of changes in the capital market on the stock price crash risk is also crucial.…”

Section: Literature Reviewmentioning

confidence: 99%

The impact of green financial development on stock price crash risk from the perspective of information asymmetry in Chinese listed companies

Zhang

Ding

2023

Environ Sci Pollut Res

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Solving the crash risk problem of corporate stock price caused by information asymmetry can mitigate the negative externality of its carbon emission to become green, low-carbon, and high-quality development. Green finance generally profoundly impacts micro-corporate economics and macro-financial systems but remains a giant puzzle of whether they can effectively resolve the crash risk. This paper examined the impact of green financial development on the stock price crash risk using the sample data of non-financial listed companies in Shanghai and Shenzhen A stock market in China from 2009 to 2020. We found that green financial development significantly inhibits the stock price crash risk; this is more obvious in listed companies with a high level of asymmetric information. And companies in high-level regions of green financial development attracted more attention from institutional investors and analysts. As a result, they disclosed more information about their operational status, thus reducing the crash risk of corporate stock price from the torrential public pressure of lousy environmental details. Therefore, this study will help continuously discuss the costs, benefits, and value promotion of green finance for synergy between corporate performance and environmental performance to improve ESG capabilities.

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“…On the other hand, researchers take the fundamental analysis hypothesis, engaging it with a resource base view and asymmetric information theory to reveal the determinants of PCR from an organization's fundamental variables. The empirical studies test the effect of climate change disclosure (Lin and Wu, 2023), ESG (Gao et al ., 2022), intellectual capital (Probohudono et al ., 2021), local CEO's ability (Chen et al ., 2022a), political orientation (Chen et al ., 2022b) and product market competition (Benkraiem et al ., 2022) on PCR. It is in line with Jin and Myers (2006), who suggested that companies may be incentivized to withhold bad news to absorb certain downside risks.…”

Section: Literature Reviewmentioning

confidence: 99%

Does sharia-compliant debt financing reduce stock price crash risk?

Kontesa¹

2023

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PurposeThis paper examines the impact of sharia-compliant debt financing on stock price crash risk. Unlike those previous studies that took Sukuk or sharia-compliant firms, this study tests the impact of the proportion reported sharia-compliant debt financing in the balance sheet on the risk of price crash of a firm.Design/methodology/approachUsing the data from 2,752 firm-year observations of 344 Malaysian non-financial listed companies from 2012 to 2019, this article used a robust panel data estimation technique for statistical inferences. This study also employs panel GMM and quantile least squares as the robustness check.FindingsThis study established a negative relationship between sharia-compliant debt financing and stock price crash risk. The robustness checks with different estimation techniques confirm the results. It implies that firms with a more significant proportion of Sharia-compliant financing tend to have lower future stock price crash risk.Practical implicationsConsistent with the Islamic finance literature, the present study contributes to the existing literature on Islamic capital markets from the perspective of stock price crash risk because it is vital for risk management and investment decision-making as a measure of tail risk for stocks. The findings of this research will assist investors in developing portfolio strategies that incorporate firms with higher levels of sharia-compliant debt financing in their balance sheets. Additionally, the results of this study suggest that policymakers and regulatory bodies should consider revising their monitoring approaches for publicly listed firms.Originality/valueThis study is interesting and unique, as it is a pioneer in testing the impact of sharia-compliant debt financing on reducing stock price crash risk.

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Climate risk disclosure and stock price crash risk: The case of China

Cited by 48 publications

References 49 publications

CEO facial structure and stock price crash risk

CEO facial structure and stock price crash risk

The impact of green financial development on stock price crash risk from the perspective of information asymmetry in Chinese listed companies

Does sharia-compliant debt financing reduce stock price crash risk?

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