Accounting and Control

Why do institutional investors request climate related disclosures?

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We examine whether institutional investors who sign up to the CDP – the world leading repository of corporate climate risk information – do so for genuine reasons or merely as a marketing front (i.e., greenwashing). We find that CDP signatories positively influence firms to answer the CDP disclosure questionnaire and that these firms lower their carbon emissions following disclosure. We also find that CDP signatories are more likely to engage with and divest from top emitters disclosing to the CDP. Overall, these results cannot be reconciled with the greenwashing hypothesis, and instead suggest that institutional investors request disclosures because they value climate-related information.
Bibliographic citation: COHEN, S., KADACH, I., ORMAZABAL, G. (2022). Why do institutional investors request climate related disclosures?.

Reference: 10.2139/ssrn.4138869 (DOI)
Date: 01/06/2022
Author(s): Shira Cohen; Igor Kadach; Gaizka Ormazabal
Document type: Working Paper
Department: Accounting and Control
Languages: English