Firm-Level Nature Dependence

Alexandre Garel, Arthur Romec, Zacharias Sautner and Alexander F. Wagner
Additional contact information
Alexandre Garel: Audencia Business School
Arthur Romec: Toulouse Business School
Zacharias Sautner: University of Zurich - Department of Finance; Swiss Finance Institute; European Corporate Governance Institute (ECGI)
Alexander F. Wagner: University of Zurich - Department of Finance; Centre for Economic Policy Research (CEPR); European Corporate Governance Institute (ECGI); Swiss Finance Institute

No 25-44, Swiss Finance Institute Research Paper Series from Swiss Finance Institute

Abstract: We construct firm-level measures of nature dependence, capturing the extent to which a firm's business activities rely on different ecosystem services. The measures cover 26,595 listed firms from 115 countries between 2010 and 2022. Nature dependence is positively correlated with a firm's impact on biodiversity but shows little correlation with exposure to physical climate risk. Nature dependence is neither related to nature-related corporate actions disclosed in the CDP survey nor reflected in firms' corporate disclosures. Interestingly, a firm's nature dependence is positively associated with measures of downside risk. These risk effects stem from high dependences on certain ecosystem services, rather than from low or moderate dependences on a greater number of ecosystem services. Nature dependence also predicts the likelihood of being targeted by BlackRock's biodiversity engagements. Overall, investors start paying attention to nature dependence, while corporate action and disclosure remain limited.

Keywords: Nature risk; biodiversity risk; nature dependence; physical risk; shareholder engagement (search for similar items in EconPapers)
JEL-codes: G12 G30 Q57 (search for similar items in EconPapers)
Pages: 80 pages
Date: 2025-04
References: Add references at CitEc
Citations:

Downloads: (external link)
https://papers.ssrn.com/sol3/papers.cfm?abstract_id=5196826 (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:chf:rpseri:rp2544

Access Statistics for this paper

More papers in Swiss Finance Institute Research Paper Series from Swiss Finance Institute Contact information at EDIRC.
Bibliographic data for series maintained by Ridima Mittal ().