Misato Sato, Glen Gostlow, Catherine Higham, Joana Setzer, Frank Venmans
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引用次数: 0
Abstract
Communities and individuals are turning to courts to hold governments and high-emitting firms to account for the adverse consequences of climate change. Such litigation is part of a broader trend in which stakeholders are increasingly scrutinizing firms for their sustainability practices. For firms, rising climate litigation risk may exacerbate wider sustainability risks. Here we construct a comprehensive database of filings and decisions relating to 108 climate lawsuits against US- and European-listed firms between 2005 and 2021. We show that firms experience, on average, a 0.41% fall in stock returns following a climate-related filing or an unfavourable court decision. Cases filed against Carbon Majors, primarily the world’s largest fossil fuel producers, saw the largest stock market responses, with returns reducing by 0.57% and 1.50% following filings and unfavourable decisions, respectively. Markets respond more to ‘novel’ climate litigation involving new legal arguments or jurisdictions. Our findings suggest that climate litigation provides a way for stakeholders to challenge actual and perceived weaknesses in the sustainability practices of firms. We conclude that financial markets consider such litigation to be a relevant financial risk. Climate lawsuits can cause direct changes in corporate behaviour, but market impacts are less understood. This study examines 15 years of litigation to find how much stock values fall when lawsuits are filed or resolved.
期刊介绍:
Nature Sustainability aims to facilitate cross-disciplinary dialogues and bring together research fields that contribute to understanding how we organize our lives in a finite world and the impacts of our actions.
Nature Sustainability will not only publish fundamental research but also significant investigations into policies and solutions for ensuring human well-being now and in the future.Its ultimate goal is to address the greatest challenges of our time.