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Do Salient Climatic Risks Affect Shareholder Voting?
Other   Open access

Do Salient Climatic Risks Affect Shareholder Voting?

Eliezer M Fich
SSRN Electronic Journal
2021
url
https://doi.org/10.2139/ssrn.3895071View
Open

Abstract

Shareholders in locations recently hit by hurricanes significantly increase their support for environmental proposals even if they never previously voted for similar initiatives. Our results show that changed beliefs about salient climate risks rather than firms’ fundamentals drive the increased support. More favorable voting following a hurricane strike has real consequences: Climate-related proposals are more likely to pass, and when they do, firm performance weakens. These findings highlight the role of investor psychology in altering shareholders’ perceptions about climate risks and, consequently, their support for corporate environmental policies

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