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Geopolitical risk and clean energy investments: Exploring the role of rare earths 地缘政治风险与清洁能源投资:探索稀土的作用
IF 7.5 1区 经济学 Q1 BUSINESS, FINANCE Pub Date : 2025-02-03 DOI: 10.1016/j.irfa.2025.103965
Lisa Depraiter , Stéphane Goutte
The energy transition from fossil fuel to renewable energy relies upon developing clean energy technologies that are mineral intensive. Critical minerals for the energy transition are subject to geopolitical risk due to increased competition over access to minerals supply. Thus, geopolitical risk may hinder the performance of clean energy markets. This study investigates the interplay between clean energy markets and geopolitical risk by focusing on rare earth elements that are key components of clean technologies, including wind turbines and electric vehicles. Using the TVP - VAR model, we study the connectedness between four clean energy indices, the rare earth market and the Geopolitical risk index from Caldara and Iacoviello (2022). We then conduct a Wavelet Coherence analysis for complementary results. Overall, the results show that geopolitical risk has a significant negative impact on the four clean energy markets during periods of increased geopolitical tensions. The magnitude of connectedness between clean energy markets, rare earth markets and geopolitical risk also increases during these periods. As a result, geopolitical risk impacts on the rare earths market and clean technology markets might hinder investment in clean energy.
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引用次数: 0
Managerial myopia and biodiversity alignment- evidence from China
IF 7.5 1区 经济学 Q1 BUSINESS, FINANCE Pub Date : 2025-02-03 DOI: 10.1016/j.irfa.2025.103974
Yinghan Zhao , Xiaoyu Qu , Brian Lucey
The preservation of biodiversity is a critical global issue intrinsically linked to humanity's future. Despite its importance, research examining the intersection of corporate management and biodiversity practices remains scarce. This study addresses this gap by investigating the influence of managerial myopia on corporate biodiversity performance. Using a dataset of 952 A-share listed companies in China from 2015 to 2022, our empirical analysis reveals that a one-unit reduction in managerial myopia corresponds to a 0.83 % improvement in biodiversity outcomes. These findings are robust, as confirmed through comprehensive sensitivity analyses. Furthermore, we identify several factors that significantly influence this relationship: the stringency of environmental regulations, resource reliability, market competition, and innovation. Notably, managerial myopia not only undermines a firm's short-term profitability but also impairs its capacity for long-term value creation by hindering its biodiversity performance.
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引用次数: 0
Can auditing facilitate the effective implementation of goodwill accounting? A perspective based on key audit matters 审计能否促进商誉会计的有效实施?基于关键审计事项的视角
IF 7.5 1区 经济学 Q1 BUSINESS, FINANCE Pub Date : 2025-02-01 DOI: 10.1016/j.irfa.2024.103896
Jingjing Xu, Yingwen Deng, Lin Wen, Kuanliang Wang
This study investigates the role of auditing in facilitating the effective implementation of goodwill accounting through key audit matters (KAMs). The findings show that excess goodwill increases the likelihood of goodwill being considered as a KAM, and firms with goodwill as a KAM are more likely to recognize goodwill impairment. The positive relationship between excess goodwill and a goodwill KAM is more pronounced when firms have a clean audit opinion, small profits before goodwill impairment, or high information transparency. However, the impact of a goodwill KAM on impairment recognition is weaker for firms with small profits. Overall, the findings highlight the crucial role of auditing in identifying clients' excess goodwill and encouraging the recognition of goodwill impairment, aligning with the perspectives of the International Accounting Standards Board.
本研究探讨了审计在通过关键审计事项(KAMs)促进商誉会计有效实施中的作用。研究结果表明,超额商誉增加了商誉被视为KAM的可能性,而将商誉作为KAM的公司更有可能确认商誉减值。当审计意见清晰、商誉减值前利润微薄或信息透明度高时,超额商誉与商誉KAM之间的正相关关系更为明显。然而,商誉KAM对减值确认的影响对利润较小的公司较弱。总体而言,调查结果突出了审计在识别客户超额商誉和鼓励确认商誉减值方面的关键作用,与国际会计准则理事会的观点一致。
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引用次数: 0
Is policy pilot a viable path to sustainable development? Attention allocation perspective
IF 7.5 1区 经济学 Q1 BUSINESS, FINANCE Pub Date : 2025-02-01 DOI: 10.1016/j.irfa.2025.103923
Jiapeng Dai
Policy pilot programs are gaining attention as innovative governance to encourage sustainable development. However, their effectiveness and influencing factors are debated, while the impact of these pilots under varying concentrations of societal attention is underexplored. This study examined whether policy pilots can aid in sustainable development by investigatingChina's carbon emissions trade pilot policy (COTPP), a market-driven environmental regulation. Using a difference-in-differences methodology, we analyzed 13,559 firm–year observations spanning 2011–2021 to assess the policy's impact on corporate carbon emissions. The empirical findings indicate that COTPP implementation significantly reduced corporate carbon emissions. There were heterogeneous effects spanning organizational and regional contexts. The emission reduction effect was more distinct for state-owned enterprises (SOEs) than non-SOEs and firms located in the economically developed eastern region relative to those in the central and western regions. Moreover, attention allocation—established through governmental, public, and media engagement—was a critical moderating factor.The moderating effect is strongest for government attention, followed by public attention, with media attention showing the weakest yet still significant effect. Integrating organizational heterogeneity and an attention allocation framework advanced the theoretical understanding of policy pilot effectiveness, providing practical insights for designing market-based environmental regulations. These findings augment environmental governance research and policy implementation practice by elucidating how contextual factors and informal institutional engagement can be leveraged to strengthen sustainable development.
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引用次数: 0
Reform of liquidation and bankruptcy court, financing constraints, and corporate long-term investment
IF 7.5 1区 经济学 Q1 BUSINESS, FINANCE Pub Date : 2025-02-01 DOI: 10.1016/j.irfa.2025.103915
Yichen Song
Based on data from listed companies in China between 2011 and 2020, this paper delves into the impact of the reform of liquidation and bankruptcy tribunals on corporate long-term investment. Using a multi-period Difference-in-Differences (DiD) model, we find that the reform of liquidation and bankruptcy tribunals significantly boosts corporate long-term investment levels. Specifically, after the implementation of the reform, listed companies in regions with liquidation and bankruptcy tribunals have higher long-term investment levels compared to those in regions without such tribunals. An analysis of moderating effects reveals the moderating role of financial constraints on the effectiveness of the reform. When corporate financing is highly constrained, creditors' bargaining power increases, and enhancing creditor protection can promote corporate long-term investment levels. Results from heterogeneity tests indicate that for companies with higher debt-to-asset ratios, those with stronger creditor monitoring intensity, the reform of liquidation and bankruptcy tribunals further promotes corporate long-term investment levels by strengthening creditor protection and reducing creditors' motives to intervene in the company's long-term investment activities.
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引用次数: 0
Impact of supply chain pressures on financial leverage 供应链压力对财务杠杆的影响
IF 7.5 1区 经济学 Q1 BUSINESS, FINANCE Pub Date : 2025-02-01 DOI: 10.1016/j.irfa.2024.103883
William Ginn , Jamel Saadaoui
This study investigates the impact of supply shocks on financial leverage (debt-equity ratio) in the U.S. economy from 1998:Q1 to 2024:Q2. The study employs a linear and non-linear Local Projections (LP) and Bayesian Vector Autoregression (BVAR) models to explore dynamic relationships. While the LP models reveal that a supply chain shock negatively affects leverage with statistically significant results, there is no evidence of state dependence. The BVAR model suggest that a supply chain shock is disruptive via reduction (an increase) in output (inflation), accompanied by lower leverage.
本研究调查了1998年第一季度至2024年第二季度美国经济中供给冲击对金融杠杆(债务权益比率)的影响。该研究采用线性和非线性局部预测(LP)和贝叶斯向量自回归(BVAR)模型来探索动态关系。虽然LP模型显示供应链冲击负向影响杠杆,统计结果显著,但没有证据表明国家依赖。BVAR模型表明,供应链冲击是破坏性的,通过减少(增加)产出(通货膨胀),伴随着较低的杠杆率。
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引用次数: 0
An integrated CEEMDAN and TCN-LSTM deep learning framework for forecasting 集成CEEMDAN和TCN-LSTM深度学习预测框架
IF 7.5 1区 经济学 Q1 BUSINESS, FINANCE Pub Date : 2025-02-01 DOI: 10.1016/j.irfa.2024.103879
Xiaotong Cai , Bo Yuan , Chao Wu
Carbon trading serves as an effective mechanism and a cost-effective tool for countries to reduce carbon emissions. This study develops a hybrid forecasting model using the complete ensemble empirical mode decomposition with adaptive noise (CEEMDAN) and temporal convolutional network-long short-term memory network (TCN-LSTM) methods to address the nonlinear and time-variant nature of carbon prices. The closing prices of carbon emission rights in Guangdong and Shanghai are used for analysis. The CEEMDAN method decomposes the intricate and irregular carbon price series into several low-frequency and regular components. Subsequently, the TCN-LSTM method extracts time-series features from these components to predict future carbon trading prices precisely. The experimental outcomes indicate that this integrated deep learning framework achieves the highest prediction accuracy, with a lag of 15 and 18 days for the Guangdong and Shanghai carbon trading markets, respectively.
碳交易是各国减少碳排放的有效机制和成本效益工具。针对碳价格的非线性和时变性,本研究使用带自适应噪声的完全集合经验模式分解(CEEMDAN)和时序卷积网络-长短期记忆网络(TCN-LSTM)方法建立了一个混合预测模型。本文采用广东和上海的碳排放权收盘价进行分析。CEEMDAN 方法将错综复杂且不规则的碳价格序列分解为多个低频且规则的成分。随后,TCN-LSTM 方法从这些成分中提取时间序列特征,从而精确预测未来的碳交易价格。实验结果表明,该集成深度学习框架的预测准确率最高,对广东和上海碳交易市场的预测滞后期分别为 15 天和 18 天。
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引用次数: 0
Does public attention to biodiversity matter to stock markets?
IF 7.5 1区 经济学 Q1 BUSINESS, FINANCE Pub Date : 2025-02-01 DOI: 10.1016/j.irfa.2025.103925
Chengchen Zhou , Yajie Chen , Qiang Ji , Dayong Zhang
Biodiversity has become an important issue in recent years, attracting great public attention. Arguably, biodiversity can be treated as a risk factor that should be priced in stock markets. To examine this issue, this paper first constructs a biodiversity attention index (BAI) based on information provided by the Baidu search engine and then examines its impact on the returns of listed firms in China. Specifically, the BAI is added to a capital asset pricing model as an additional factor, and then the model is used to analyse individual stock returns. By summarising the results from a bottom-up perspective, we find that BAI can affect stock returns to a certain extent and the impacts are highly heterogeneous across sectors. The pricing power of the BAI increases over time, with a growing number of companies affected. Further investigation shows that younger, larger firms and firms with better financial or environmental performance tend to be less sensitive to the BAI. Overall, this study provides important evidence to understand biodiversity–finance linkages and further highlights the need to incorporate public attention towards environmental issues into financial practices.
{"title":"Does public attention to biodiversity matter to stock markets?","authors":"Chengchen Zhou ,&nbsp;Yajie Chen ,&nbsp;Qiang Ji ,&nbsp;Dayong Zhang","doi":"10.1016/j.irfa.2025.103925","DOIUrl":"10.1016/j.irfa.2025.103925","url":null,"abstract":"<div><div>Biodiversity has become an important issue in recent years, attracting great public attention. Arguably, biodiversity can be treated as a risk factor that should be priced in stock markets. To examine this issue, this paper first constructs a biodiversity attention index (BAI) based on information provided by the Baidu search engine and then examines its impact on the returns of listed firms in China. Specifically, the BAI is added to a capital asset pricing model as an additional factor, and then the model is used to analyse individual stock returns. By summarising the results from a bottom-up perspective, we find that BAI can affect stock returns to a certain extent and the impacts are highly heterogeneous across sectors. The pricing power of the BAI increases over time, with a growing number of companies affected. Further investigation shows that younger, larger firms and firms with better financial or environmental performance tend to be less sensitive to the BAI. Overall, this study provides important evidence to understand biodiversity–finance linkages and further highlights the need to incorporate public attention towards environmental issues into financial practices.</div></div>","PeriodicalId":48226,"journal":{"name":"International Review of Financial Analysis","volume":"98 ","pages":"Article 103925"},"PeriodicalIF":7.5,"publicationDate":"2025-02-01","publicationTypes":"Journal Article","fieldsOfStudy":null,"isOpenAccess":false,"openAccessPdf":"","citationCount":null,"resultStr":null,"platform":"Semanticscholar","paperid":"143148779","PeriodicalName":null,"FirstCategoryId":null,"ListUrlMain":null,"RegionNum":1,"RegionCategory":"经济学","ArticlePicture":[],"TitleCN":null,"AbstractTextCN":null,"PMCID":"","EPubDate":null,"PubModel":null,"JCR":null,"JCRName":null,"Score":null,"Total":0}
引用次数: 0
Is ESG performance a protective umbrella for ESG violations?
IF 7.5 1区 经济学 Q1 BUSINESS, FINANCE Pub Date : 2025-02-01 DOI: 10.1016/j.irfa.2024.103858
Hongrui Chai , Zhenhao Cheng , Weixing Wu
We investigate whether environmental, social, and governance (ESG) performance acts as an umbrella protecting stock prices from ESG violations. Using ESG violation events from 2009 to 2022 in China, we find that the listed companies with high ESG performance exhibit lower cumulative abnormal returns during the event window. Further, the negative relation between ESG performance and market reaction during ESG violations is moderated by the motivation of ESG practices and the risk of greenwashing. Specifically, compared with the firms that view ESG development as a long-term goal, the negative relationship between ESG performance and market reaction is stronger for firms treating ESG as a short-term profitability tool. Companies with high greenwashing risk demonstrate an intensified negative relationship between ESG performance and market reaction during violations.
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引用次数: 0
The impact of industrial land prices and regional strategical interactions on environmental pollution in China
IF 7.5 1区 经济学 Q1 BUSINESS, FINANCE Pub Date : 2025-02-01 DOI: 10.1016/j.irfa.2025.103921
Malin Song , Chong Peng , Guanchun Liu , Anna Min Du , Agyenim Boateng
This study explores the environmental impact of industrial land prices and strategic interactions among local governments in China, with a focus on how they contribute to pollution. Departing from traditional economic growth models, modern approaches emphasize high-quality development and productivity, considering environmental sustainability. China faces a significant challenge in balancing its economic and environmental performance, necessitating a shift toward a greener development model. Using city-level data and industrial land transfers, we employ two-stage least squares estimates and a spatial lag model to assess the effects of industrial land pricing and local government competition on environmental pollution. Our findings indicate that lower industrial land prices exacerbate pollution, particularly in China's mid-western regions, where land supply policies have intensified this effect. Strategic interactions among local governments in these regions lead to a lose-lose scenario, diminishing the agglomeration effect and worsening environmental outcomes. However, the 2013 reform of China's evaluation system, which placed greater emphasis on environmental protection, has alleviated some of the pollution effects driven by low land price competition. We conclude that reducing land allocation distortions and their spatial spillover effects is critical to achieving high-quality, eco-friendly economic development in China.
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International Review of Financial Analysis
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