Abstract

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

Keywords

DivestmentClimate riskBusinessEquity (law)Institutional investorClimate changePortfolioRisk managementFinanceCorporate governance

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Publication Info

Year
2019
Type
article
Volume
33
Issue
3
Pages
1067-1111
Citations
2224
Access
Closed

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Cite This

Philipp Krueger, Zacharias Sautner, Laura T. Starks (2019). The Importance of Climate Risks for Institutional Investors. Review of Financial Studies , 33 (3) , 1067-1111. https://doi.org/10.1093/rfs/hhz137

Identifiers

DOI
10.1093/rfs/hhz137

Data Quality

Data completeness: 81%