The level of climate risk reporting performance and firm characteristics: Evidence from the Saudi Stock Exchange

Q2 Economics, Econometrics and Finance Investment Management and Financial Innovations Pub Date : 2023-12-07 DOI:10.21511/imfi.20(4).2023.29
Awatif Hodaed Alsheikh, Warda Hodaed Alsheikh
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Abstract

In recent decades, stakeholders have begun to place a greater emphasis on sustainability-related issues, including climate change. Furthermore, the implementation of climate change initiatives has prompted companies to disclose information regarding their evaluation and handling of climate-related risks and potential benefits. However, there is a lack of existing literature that investigates this issue in less developed markets, particularly in Saudi Arabia, where the capital market is rapidly developing. The objective of this study is to assess the degree of performance in reporting climate risk and investigate potential correlations between climate risk reporting performance and firm characteristics among non-financial firms in Saudi Arabia during the period from 2018 to 2021. To achieve the objectives of the study, a total of 515 firm-year observations were utilized, representing 140 non-financial firms in the context of Saudi Arabia. The study’s findings illustrate that the climate risk reporting performance level has steadily improved in Saudi companies over the years. In addition, the findings reveal that firm size and industry exhibit a positive correlation with climate risk reporting performance. Conversely, firm leverage and profitability do not demonstrate such associations. The results are in line with alternative measures of climate risk reporting performance, as well as when climate risk reporting performance is broken down into the four core elements. Policymakers and market regulators could use these results to promote awareness of the factors that influence climate risk reporting performance and to enhance sustainable practices.
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气候风险报告绩效水平与公司特征:来自沙特证券交易所的证据
近几十年来,利益相关者开始更加重视与可持续性相关的问题,包括气候变化。此外,气候变化倡议的实施促使公司披露有关其评估和处理气候相关风险和潜在利益的信息。然而,缺乏在欠发达市场调查这一问题的现有文献,特别是在资本市场迅速发展的沙特阿拉伯。本研究的目的是评估气候风险报告的绩效程度,并调查2018年至2021年期间沙特阿拉伯非金融公司气候风险报告绩效与公司特征之间的潜在相关性。为了实现研究的目标,总共使用了515家公司的年度观察结果,代表了沙特阿拉伯背景下的140家非金融公司。研究结果表明,多年来,沙特公司的气候风险报告绩效水平稳步提高。此外,研究结果还表明,企业规模和行业与气候风险报告绩效呈正相关。相反,企业杠杆率和盈利能力没有表现出这种关联。这些结果与气候风险报告绩效的其他衡量标准一致,也与将气候风险报告绩效分解为四个核心要素时的结果一致。政策制定者和市场监管者可以利用这些结果来提高对影响气候风险报告绩效的因素的认识,并加强可持续实践。
本文章由计算机程序翻译,如有差异,请以英文原文为准。
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来源期刊
Investment Management and Financial Innovations
Investment Management and Financial Innovations Economics, Econometrics and Finance-Finance
CiteScore
2.50
自引率
0.00%
发文量
99
审稿时长
11 weeks
期刊介绍: The international journal “Investment Management and Financial Innovations” encompasses the results of theoretical and empirical researches carried out both on macro- and micro-levels, concerning various aspects of financial management and corporate governance, investments and innovations (including using of quantitative methods). It is focused on the international community of financiers, both academics and practitioners. Key topics: financial and investment markets; government policy and regulation; corporate governance; information and market efficiency; financial forecasting and simulation; financial institutions: investment companies, investment funds, investment banks, hedge funds, private pension funds; objects of real and financial investing; financial instruments and derivatives; efficiency of investment projects; econometric and statistic methods in project management; alternative investments; ratings and rating agencies.
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