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The value of climate disclosure: Evidence from corporate bond credit spreads

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  • Xiang, Youtao
  • Gong, Junmei

Abstract

Motivated by the growing global concern over climate change and the increasing demand from creditors for climate-related information, we examine the effect of climate information disclosure on corporate bond credit spreads. By utilizing a sample of Chinese listed firms from 2008 to 2023, this study constructs a comprehensive climate information disclosure index based on the four pillars of the Task Force for Climate-related Financial Disclosures (TCFD). Employing the panel fixed-effect model for empirical tests, we document that climate information disclosure tends to deteriorate credit spreads. Further mechanism analyses suggest two channels: a reduction in information asymmetry and a decline in credit risk, both of which contribute to lowering bond credit spreads. Our findings suggest that investors value corporate transparency regarding climate information, providing insights for regulators worldwide seeking to understand the potential usefulness of mandatory climate disclosure.

Suggested Citation

  • Xiang, Youtao & Gong, Junmei, 2026. "The value of climate disclosure: Evidence from corporate bond credit spreads," Finance Research Letters, Elsevier, vol. 103(C).
    • Handle: RePEc:eee:finlet:v:103:y:2026:i:c:s1544612326006847
    DOI: 10.1016/j.frl.2026.110156
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    Keywords

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    JEL classification:

    • G12 - Financial Economics - - General Financial Markets - - - Asset Pricing; Trading Volume; Bond Interest Rates
    • G30 - Financial Economics - - Corporate Finance and Governance - - - General
    • Q54 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Climate; Natural Disasters and their Management; Global Warming

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