The Importance of Climate Risks for Institutional Investors

Philipp Krueger, Zacharias Sautner and Laura T. Starks
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Zacharias Sautner: Frankfurt School of Finance & Management gemeinnützige GmbH; European Corporate Governance Institute (ECGI)
Laura T. Starks: University of Texas at Austin - Department of Finance

No 18-58, Swiss Finance Institute Research Paper Series from Swiss Finance Institute

Abstract: According to our survey regarding climate-risk perceptions, institutional investors believe these risks have financial implications for their portfolio firms and that the risks have already begun to materialize, particularly regulatory risks. Many of the investors, especially the long-term, larger and ESG-oriented investors, consider risk management and engagement, rather than divestment, to be the better approach for addressing climate risks. Although the investors believe that some equity valuations do not fully reflect climate risks, their perceived overvaluations are not large. In addition, a widespread view exists that climate-risk disclosure needs improvement.

Pages: 78 pages
Date: 2018-08
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Related works:
Journal Article: The Importance of Climate Risks for Institutional Investors (2020)
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Persistent link: https://EconPapers.repec.org/RePEc:chf:rpseri:rp1858

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