Does managerial climate attention matter? Evidence on corporate default risk from China
Bibliographic Data
| ID | 6455885 |
|---|---|
| Authors | Xudong Yang (0000-0002-7398-4229), Yuan Zheng (0000-0002-4991-0190) |
| Year | 2025 |
| Volume | 10 |
| Pages | 100965-100965 |
| Publication date | 2025-07-04 |
| Peer Reviewed | Yes |
| Open Access | Yes |
| Type | ARTICLE |
| Venue | Sustainable Futures (JOURNAL) |
| Journal identifiers | ISSN: 2666-1888 |
| Publisher | Elsevier BV (PUBLISHER) |
| DOI | 10.1016/j.sftr.2025.100965 |
| OpenAlex | W4412027195 |
| Language | EN |
| References cited | 38 |
As global attention to sustainability intensifies, businesses are increasingly integrating climate considerations into their strategic decision-making processes. This study examines the relationship between managerial attention to climate issues and corporate default risk in Chinese firms. Utilizing textual analysis of Management Discussion and Analysis (MD&A) sections in financial reports, we construct managerial climate attention measures and investigate their impact on expected default frequency. Our findings reveal a significant negative relationship between managerial climate attention and default risk, with higher managerial climate attention correlating with lower default probability. Further analysis identifies two primary mechanisms mediating this relationship: improved operational stability and enhanced internal control quality. Cross-sectional analysis demonstrates heterogeneous effects, with the risk-mitigating impact of managerial climate attention being more pronounced in firms with lower financial constraints and larger size, as well as in regions facing higher pollution levels or greater exposure to extreme climate risks. Beyond risk reduction, our results show that managerial climate attention is associated with tangible outcomes including lower carbon emissions, better Environmental, Social, and Governance performance, and improved firm value. These findings provide important implications for managers and policymakers, highlighting the financial benefits of climate attention and supporting policies that encourage corporate climate engagement. Our study contributes to the growing literature on the financial implications of climate initiatives and offers valuable insights for promoting corporate sustainability in emerging markets
Actuarial science · Business · China · Credit risk · Default Risk · Political science · Corporate Finance and Governance · Insurance and Financial Risk Management · Risk Management in Financial Firms
Managerial cognitive capabilities and the microfoundations of dynamic capabilities
Do Investment-Cash Flow Sensitivities Provide Useful Measures of Financing Constraints?
The Importance of Climate Risks for Institutional Investors
Organizational Response to Adversity
Do investors care about carbon risk?
Upper Echelons
Corporate carbon performance data
| Citation velocity | historical |
|---|---|
| Highly cited | No |