Abstract
We measure US commercial banks' exposure to and materiality of physical climate risk by examining branch-level data. Our location-specific climate risk measure is pos- itively associated with banks' ESG performance and negatively associated with stake- holders' sentiment regarding ESG issues. Furthermore, banks that experience climate risk shocks, as proxied by NOAA billion-dollar disasters, improve ESG performance and receive positive ESG sentiment accordingly compared with matched banks. While negative sentiment due to climate risk exposure is associated with worsened financial performance, stronger ESG engagement mitigates this adverse effect.
| Original language | American English |
|---|---|
| Article number | 100924 |
| Number of pages | 20 |
| Journal | Global Finance Journal |
| Volume | 59 |
| DOIs | |
| State | Published - Mar 2024 |
Bibliographical note
Publisher Copyright:© 2023
ASJC Scopus Subject Areas
- Finance
- Economics and Econometrics
Keywords
- And ESG sentiment
- Climate risk
- Commercial banks
- ESG performance
Disciplines
- Business
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