How climate risk drives corporate green innovation: Evidence from China

Ye Tian, Songbo Chen and Li Dai

Finance Research Letters, 2024, vol. 59, issue C

Abstract: This study examines the link between climate risk perception (CRP) and corporate green innovation (CGI) in Chinese firms. Using the MD&A, we introduce a novel method to assess climate risk, employing Word2Vec to construct CRP based on word patterns for A-share listed firms. Results show a strong positive relationship between CRP and CGI, notably in high-tech and state-owned enterprises. Firms excelling in environmental governance and digital technologies tend to pursue green innovation in response to climate risks. Our findings offer fresh insights into evolving firm perceptions of climate risks and their influence on green innovation.

Keywords: Corporate green innovation; Climate risk; MD&A; Textual analysis (search for similar items in EconPapers)
JEL-codes: G14 G32 G40 M41 (search for similar items in EconPapers)
Date: 2024
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Citations: View citations in EconPapers (10)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:finlet:v:59:y:2024:i:c:s1544612323011340

DOI: 10.1016/j.frl.2023.104762

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