Using data from 41 different countries including the United States, we provide novel empiricalevidence that firms increase their cash holdings as a response to climate risk. This effect is drivenby financially constrained firms and becomes significantly stronger after the release of the...

The adoption of Paris agreement to reduce carbon emissions in response to global climate change exacerbates the uncertainty of high-carbon emitters. We document that high-carbon emitters choose to increase cash holdings after the adoption of Paris Agreement in the context of Chinese listed...

This paper empirically examines the impact of exposure to climate change risk on the firm's financing decisions. We study publicly traded firms listed in the U.S. from Compustat between 2002 and 2020. Our analysis contributes to the literature by establishing a direct relationship between...

Using a large sample of firms across 35 countries from 2001 to 2021, we show a significantly positive association between a firm's climate risk exposure and speed of leverage adjustment. A plausible explanation is that climate risk exposure mitigates agency conflicts and improves information...

We study the relationship between climate change social norms (CCSN) and corporate cash holdings for U.S. firms. We find that county-level CCSN is significantly positively associated with cash holdings. Our main finding is robust to a battery of robustness tests. In a subsample analysis, we find...

Using firm-level climate change exposure data, we show that firms significantly increase their cash holdings in response to increases in climate changes. Our results are robust to using alternative climate change measures and alternative cash ratio measures. We present that the increase in cash...

We examine the impact of climate policy uncertainty on corporate cash policies using news-based measures of climate policy uncertainty. We find that climate policy uncertainty induces high cash flow volatility, which causes firms to increase precautionary cash holdings. The relation between...