Companies that proactively manage climate risks boost their valuations, while those with a passive stance are discounted in the equity market, according to new research.

A pioneering study from the University of Florida has quantified corporations’ exposure to climate change risks like hurricanes, wildfires, and climate-related regulations and the extent to which climate risks are priced into their market valuations. The research also exposes a costly divide – companies that proactively manage climate risks fare much better than those that ignore the threats.

The "Corporate Climate Risk: Measurements and Responses" is published in the Review of Financial Studies.

The research team also shared their climate risk measures at

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