IDEAS home Printed from https://ideas.repec.org/a/eee/finlet/v85y2025ipcs1544612325013273.html

Biodiversity risk and value creation in emerging markets

Author

Listed:
  • Sun, Wenjie
  • Mei, Jianhua
  • Chen, Kecun
  • Li, Zhaoqi

Abstract

This study investigates how biodiversity risk management affects corporate value in Chinese A-share listed firms. Findings indicate that (1) proactive biodiversity risk management significantly enhances firm value, particularly in large enterprises and environmentally sensitive industries. (2) Green innovation is a crucial mechanism through which biodiversity risk management translates into corporate value enhancement. (3) Institutional investor oversight amplifies this positive effect, providing practical guidance for market-based biodiversity conservation strategies in emerging economies.

Suggested Citation

  • Sun, Wenjie & Mei, Jianhua & Chen, Kecun & Li, Zhaoqi, 2025. "Biodiversity risk and value creation in emerging markets," Finance Research Letters, Elsevier, vol. 85(PC).
    • Handle: RePEc:eee:finlet:v:85:y:2025:i:pc:s1544612325013273
    DOI: 10.1016/j.frl.2025.108069
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S1544612325013273
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.frl.2025.108069?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to

    for a different version of it.

    References listed on IDEAS

    as
    1. Ravi Bansal & Mariano Max Croce & Wenxi Liao & Samuel Rosen, 2019. "Uncertainty-Induced Reallocations and Growth," NBER Working Papers 26248, National Bureau of Economic Research, Inc.
    2. Zhao, Yinghan & Qu, Xiaoyu & Lucey, Brian, 2025. "Managerial myopia and biodiversity alignment- evidence from China," International Review of Financial Analysis, Elsevier, vol. 100(C).
    3. Adhikari, Hari P. & More, Deepak G. & Sah, Nilesh B., 2025. "Climate change exposure and short-termism: Evidence from net trade credit," International Review of Financial Analysis, Elsevier, vol. 103(C).
    4. Chen, Yinying & Yin, Liang & Hu, Shiyang & Li, Xiang, 2025. "Biodiversity conservation and corporate environmental information disclosure: Evidence from a quasi-natural experiment in China," International Review of Financial Analysis, Elsevier, vol. 102(C).
    5. Wang, Yueyang, 2025. "The silent cost of biodiversity loss: Unveiling its impact on institutional ownership," International Review of Financial Analysis, Elsevier, vol. 103(C).
    6. Yang, Chao & Song, Di, 2025. "How does climate change exposure affects green innovation in China: A framework for categorizing innovation," International Review of Financial Analysis, Elsevier, vol. 103(C).
    7. Lei, Xue & Xu, Xueguo, 2024. "Storm clouds over innovation: Typhoon shocks and corporate R&D activities," Economics Letters, Elsevier, vol. 244(C).
    8. Wang, Lei & Qu, Xinyi & Wang, Yunquan & Lu, Jun & Wang, Qi, 2025. "Economic policy uncertainty, related-party transactions and corporate liquidity," Finance Research Letters, Elsevier, vol. 76(C).
    9. He, Feng & Duan, Lin & Lucey, Brian & Hao, Jing, 2025. "Biodiversity risk or climate risk? Which factor affects corporate ESG rating divergence," International Review of Financial Analysis, Elsevier, vol. 104(PA).
    10. Marrero, Gustavo A. & Puch, Luis A. & Ramos-Real, Francisco J., 2015. "Mean-variance portfolio methods for energy policy risk management," International Review of Economics & Finance, Elsevier, vol. 40(C), pages 246-264.
    11. Liu, Wenhua & Liu, Yang & Wen, Fenghua & Gong, Xu, 2025. "Climate policy uncertainty and analyst earnings forecasts: Evidence from the Chinese energy sector," International Review of Financial Analysis, Elsevier, vol. 100(C).
    12. Zhou, Yang & Lucey, Brian M. & He, Feng, 2025. "Dividend payouts and biodiversity risk — Chinese evidence," Research in International Business and Finance, Elsevier, vol. 76(C).
    13. Zhang, Liyuan & Luo, Zhenqing & Yu, Xiaoyuan & Yang, Qiming & Wang, Jiancong, 2025. "Economic policy uncertainty and corporate green innovation," International Review of Financial Analysis, Elsevier, vol. 97(C).
    14. Zhang, Ni & Han, Hongjun, 2025. "The new environmental protection law, political connections and corporate ESG performance," International Review of Financial Analysis, Elsevier, vol. 102(C).
    15. Ongsakul, Viput & Chatjuthamard, Pattanaporn & Chintrakarn, Pandej & Jiraporn, Pornsit, 2025. "Climate change exposure in uncertain times: A text-based approach," International Review of Economics & Finance, Elsevier, vol. 100(C).
    16. Zhang, WenXue & Tian, Yuhao & Zhu, Zeyu, 2025. "Corporate excess cash, economic policy uncertainty and stock price crash risk," Finance Research Letters, Elsevier, vol. 81(C).
    17. Guo, Guangyu & Lin, Ouwen & Li, Yan & Ruan, Jiyang, 2024. "Corporate carbon emission governance: The mediating role of financial leverage," International Review of Economics & Finance, Elsevier, vol. 96(PC).
    18. Lin, Ouwen & Guan, Jianbo, 2024. "The impact of media attention, board independence on CEO power, and ESG in state-owned enterprises," Finance Research Letters, Elsevier, vol. 62(PA).
    19. Cao, Yuqiang & Liu, Yunxin & Lu, Meiting & Shan, Yaowen & Zu, Yanglan, 2025. "Generosity under environmental pressure: Climate change exposure and corporate philanthropy," International Review of Financial Analysis, Elsevier, vol. 104(PA).
    20. Stefan Ambec & Mark A. Cohen & Stewart Elgie & Paul Lanoie, 2013. "The Porter Hypothesis at 20: Can Environmental Regulation Enhance Innovation and Competitiveness?," Review of Environmental Economics and Policy, Association of Environmental and Resource Economists, vol. 7(1), pages 2-22, January.
    21. Ma, Feng & Wu, Hanlin & Zeng, Qing, 2024. "Biodiversity and stock returns," International Review of Financial Analysis, Elsevier, vol. 95(PA).
    22. Tan, Ruipeng & Hou, Ke & Wu, Huaqing, 2025. "The cost of biodiversity protection: National Key Ecological Functional Zone and labor demand in China," Journal of Asian Economics, Elsevier, vol. 97(C).
    23. William Ocasio, 1997. "Towards An Attention‐Based View Of The Firm," Strategic Management Journal, Wiley Blackwell, vol. 18(S1), pages 187-206, July.
    24. Lei, Xue & Xu, Xueguo, 2025. "The “spider web” of venture capital: An invisible force driving corporate green technology innovation," Technology in Society, Elsevier, vol. 82(C).
    25. Teece, David J, 2018. "Dynamic capabilities as (workable) management systems theory," Journal of Management & Organization, Cambridge University Press, vol. 24(3), pages 359-368, May.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Ma, Chaoqun & Gao, Lu & Jiang, Yong & Ren, Yi-Shuai, 2025. "How biodiversity information disclosures spill the beans on firm value?," Finance Research Letters, Elsevier, vol. 85(PD).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Xu, Wenjie & Xie, Wenqiang, 2025. "Supply chain finance and tourism enterprise resilience in the context of economic policy uncertainty," Finance Research Letters, Elsevier, vol. 86(PA).
    2. Zhu, Chenyu & Liu, Liwen & Zhou, Shoujie & Han, Lifeng, 2025. "Executive misconduct and corporate operational risk," Finance Research Letters, Elsevier, vol. 84(C).
    3. Zhang, Qiang & Lou, Mingyu, 2025. "Executive team faultlines, business diversification, and corporate substantive innovation," International Review of Economics & Finance, Elsevier, vol. 103(C).
    4. Li, Yi & Liu, Tong & Wang, Zhaohua, 2025. "Do ESG-conscious fund managers drive green innovation? An LLM-based textual analysis of fund manager narratives," Research in International Business and Finance, Elsevier, vol. 77(PB).
    5. Li, Jun & Jin, Yihang & Zhou, Peng, 2025. "Do banks price firms' biodiversity risk? Evidence from the Kunming declaration," International Review of Financial Analysis, Elsevier, vol. 106(C).
    6. Zhou, Jingyi & Xie, Mengyuan, 2025. "Chain leader policy and corporate green innovation—Perspectives of financing constraints and risk-taking," International Review of Financial Analysis, Elsevier, vol. 106(C).
    7. Pan, Haiyue & Lei, Xue & Lin, Ouwen, 2025. "Internationalization labels of executives and corporate innovation—Form over substance?," International Review of Financial Analysis, Elsevier, vol. 107(C).
    8. Zhou, Jingyi & Xie, Mengyuan, 2025. "Supply chain risk perception and corporate green innovation bubbles," Finance Research Letters, Elsevier, vol. 85(PC).
    9. Xie, Xiaoyu & Guo, Kaige & Han, Zhongya, 2025. "Digital technology application and green technological innovation under economic policy uncertainty: Empirical evidence from China's manufacturing industry," International Review of Financial Analysis, Elsevier, vol. 108(PA).
    10. Xiaoqing Dong & Guangshun Cheng & Yuan Ren, 2025. "Going Green on the Government’s Dime: Unpacking the Subsidy Boost in Family Firms," Sustainability, MDPI, vol. 17(10), pages 1-25, May.
    11. Xue Lei & Jian Xu & Ziyan Zhang, 2025. "Can the Energy Rights Trading System Become the New Engine for Corporate Carbon Reduction? Evidence from China’s Heavy-Polluting Industries," Sustainability, MDPI, vol. 17(18), pages 1-19, September.
    12. Jia, Haifeng & Huang, Xinyi & Gong, Yuechen & Liu, Youping & Jiang, Hui, 2025. "Can climate risk disclosure improve corporate green innovation?," Finance Research Letters, Elsevier, vol. 83(C).
    13. Ma, Xiaoning & Lei, Xue & Jiang, Yu & Lin, Ouwen, 2025. "How trade friction amplifies corporate litigation risk: Evidence from United States–China tariff disputes," Finance Research Letters, Elsevier, vol. 85(PA).
    14. Xia, Weifeng & Ruan, Zhiyu & Ma, Shenglin & Zhao, Jin & Yan, Jiale, 2025. "Can the digital economy enhance carbon emission efficiency? Evidence from 269 cities in China," International Review of Economics & Finance, Elsevier, vol. 97(C).
    15. Wang, Haiyin & Wei, Xinyuan & Ma, Shenglin & Li, Yuan & Yuan, Yanzhe, 2025. "Can national sentiment promote green innovation in Chinese firms?," International Review of Economics & Finance, Elsevier, vol. 98(C).
    16. Zou, Siqi & Long, Yang, 2025. "The nonlinear impact of economic policy uncertainty on corporate green total factor productivity," Finance Research Letters, Elsevier, vol. 77(C).
    17. Jia, Zhao & Li, Yuan & Wang, Junling & Wang, Zehao & Zhao, Guobin, 2025. "A study on the measurement of China's manufacturing industry chain toughness and regional heterogeneity from a dynamic perspective," International Review of Economics & Finance, Elsevier, vol. 102(C).
    18. Xu, Jiamin, 2025. "Does managerial myopia impede corporate internationalization?," International Review of Economics & Finance, Elsevier, vol. 103(C).
    19. Bao, Xiaohua & Gao, Deting & Wei, Yaning & Wu, Wentao & Zhang, Jie, 2025. "Connect to certainty: Domestic trade network and trade policy uncertainty," Finance Research Letters, Elsevier, vol. 82(C).
    20. Cosma, Simona & Cosma, Stefano & Pennetta, Daniela & Rimo, Giuseppe, 2025. "Does biodiversity matter for firm value?," Journal of International Financial Markets, Institutions and Money, Elsevier, vol. 105(C).

    More about this item

    Keywords

    ;
    ;
    ;

    JEL classification:

    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill
    • Q57 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Ecological Economics
    • O35 - Economic Development, Innovation, Technological Change, and Growth - - Innovation; Research and Development; Technological Change; Intellectual Property Rights - - - Social Innovation
    • G14 - Financial Economics - - General Financial Markets - - - Information and Market Efficiency; Event Studies; Insider Trading

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:finlet:v:85:y:2025:i:pc:s1544612325013273. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/frl .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.