When green meets green

Degryse, Hans; Goncharenko, Roman; Theunisz, Carola; Vadász, Tamás

doi:10.1016/j.jcorpfin.2023.102355

Cited by 59 publications

(30 citation statements)

References 58 publications

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“…While we have provided evidence on the significance of the Stern Report on elevating climate change awareness, we acknowledge that there may still be concerns on the relevance and significance of the Stern Report. Therefore, we conduct another quasi‐natural experiment based on the Paris Climate Accord (Altunbas et al., 2022; Degryse et al., 2023; Ginglinger & Moreau, 2022) and find consistent results. In this analysis, we use CC_EXPOSURE_ND , an alternative measure of climate risk that we used for our robustness checks in Table 4.…”

Section: Identification and Endogeneitymentioning

confidence: 60%

Climate change and corporate cash holdings: Global evidence

Javadi

Masum

Aram

et al. 2023

Financial Management

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Using data from 41 countries, we provide novel empirical evidence that firms’ cash holdings are positively associated with their climate change exposure. This evidence is robust to different model specifications and survives a battery of tests to ease concerns related to spurious correlation and omitted variable bias. Using the release of the Stern Review as an exogenous shock to climate change awareness, we show that this association becomes significantly stronger after the release of the Review and particularly so for firms with higher exposure to regulatory and transition risk dimensions of climate change as well as financially constrained firms. Overall, results fit consistently within the precautionary motive framework and suggest that firms hold more cash to safeguard against the adverse impact of climate change.

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Section: Identification and Endogeneitymentioning

confidence: 60%

Climate change and corporate cash holdings: Global evidence

Javadi

Masum

Aram

et al. 2023

Financial Management

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“…In line with previous studies (e.g., Degryse et al 2023, Delis et al 2021, we label as "Green" the banks that, in each year t, are already members of the United Nations Environment Programme Finance Initiative (UNEP FI). Therefore, the dummy GreenBank is attributed value 1 for each year that follows the lenders' joining of the Initiative.…”

Section: Lenders' Green Attitudementioning

confidence: 63%

“…Literature shows that the lenders' ethical attitudes are also relevant determinants for loan pricing decisions in relation to risks derived from sources that are not merely financial, such as CTR (for instance, Degryse et al 2023, Delis et al 2017.…”

Section: Lenders' Green Attitudementioning

confidence: 99%

“…Specifically, we extend the literature on the implications of climate change for banks, which is mainly focused on the loan pricing effects of climate‐related risks (e.g., Degryse et al 2023; Delis et al 2021; Ehlers et al 2022; Fard et al 2020). Only a few studies examine how credit supply responds to increased climate‐related risks (e.g., Kacperczyk and Peydró, 2021; Reghezza et al 2021).…”

Section: Introductionmentioning

confidence: 99%

“…We fill this gap by examining how banks adjust their lending policies to higher transition risk and by accounting for various climate risk drivers at the levels of banks, borrowers, and countries. Specifically, we extend the literature on the implications of climate change for banks, which is mainly focused on the loan pricing effects of climate-related risks (e.g., Degryse et al 2023;Delis et al 2021;Ehlers et al 2022;Fard et al 2020). Only a few studies examine how credit supply responds to increased climate-related risks (e.g., Kacperczyk and Peydró, 2021;Reghezza et al 2021).…”

mentioning

confidence: 99%

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Climate transition risk and bank lending

Bruno,

Lombini

2023

J of Financial Research

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We investigate whether and how banks in the global syndicated loan market adjusted the pricing and supply of credit to account for higher climate transition risk (CTR) in the years following the 2015 Paris Agreement. We measure CTR by considering the pollution levels of borrowers and the engagement of countries where borrowers are headquartered in addressing climate change issues. The evidence is mixed and points to non‐linear relations between lending variables and CO2 emissions. Policy events such as the Paris Agreement and government environmental awareness are significant climate risk drivers that, when combined, may amplify banks’ perception of CTR.This article is protected by copyright. All rights reserved.

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Do bankers on board fulfill their role? Corporate social responsibility, environmental concerns and firm leverage

Ghosh

2024

Corp Soc Responsibility Env

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Using a dataset of listed Indian manufacturing firms for 2010–2020, the study examines their financial response to climate risks in the presence of banker‐directors. The results show that climate sensitivity and vulnerability exert a negative impact on firm leverage and cost whereas climate adaptation has relatively limited impact. These effects broadly resonate across firm ownership, although it differ across firm‐bank equity interlocks. The overall impact of these developments is manifest in a decline in investment. The findings suggest that policymakers need to be more responsive to firm‐bank interactions, as these can impact firm behavior and have real economic consequences.

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When green meets green

Cited by 59 publications

References 58 publications

Climate change and corporate cash holdings: Global evidence

Climate change and corporate cash holdings: Global evidence

Climate transition risk and bank lending

Do bankers on board fulfill their role? Corporate social responsibility, environmental concerns and firm leverage

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