Footnote:
Nach Informationen von SSRN wurde die ursprüngliche Fassung des Dokuments January 3, 2023 erstellt
Description:
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 industrial firms. Economically, high-carbon emitters’ cash holding increases about 2.6% on average comparing to low-carbon emitters after the adoption of Paris Agreement. Further analysis shows that high-carbon emitters with stronger external financial constraints and more volatile cash flows prefer to hold more cash for pre-cautionary. Moreover, we find that cash holdings are more sensitive to firm value when carbon risk is high, which supports value creation motive. In response to high carbon risk, we show that high-carbon emitters tend to commit to green transition to alleviate the impact of carbon risk