Faculty of Economics and Business, U. of Groningen, Netherlands
We examine firms’ responses to climate change exposure by exploring the relationship between organizational time horizons and climate-related outcomes. Drawing on theory relating to issue salience and temporality, we investigate the joint effects of organizational climate change exposure and time horizons on firms’ climate strategy disclosure and subsequent emissions intensity reductions. To do so, we analyze text transcript data from firms’ conference calls with investment analysts across a global sample. Our results suggest a divergence between firms’ climate strategy disclosure and their reduction of carbon emissions intensity. We find firms that exhibit climate change exposure and short-term horizons are more likely to disclose a climate strategy, whereas those facing climate change exposure with longer-term horizons are more likely to reduce their carbon emissions intensity. We then categorize firms’ actions to identify differences between those taking substantive climate actions compared to those that primarily act symbolically. In doing so, we highlight the characteristics of firms that adopt a “both/and” approach to dealing with climate-related temporal tensions.
