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When nature disrupts: biodiversity risk and corporate supply chain resilience

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  • Jin, Wenwen

Abstract

Although climate change risks have been extensively examined, biodiversity risk has emerged as a pressing yet understudied ecological threat to supply chain resilience (SCR). Motivated by the increasing disruptions from biodiversity degradation, this study explores how biodiversity risk shapes SCR in Chinese listed firms. Using fixed effects and instrumental variable approaches, we find that biodiversity risk significantly undermines SCR. The negative effects are especially pronounced in firms with limited diversification, fewer female directors, a manufacturing focus, and non-state ownership. Mechanism tests reveal that maturity mismatch and agency costs channel the negative impact. These findings highlight biodiversity risk as a distinct source of supply chain vulnerability and offer insights into enhancing SCR.

Suggested Citation

  • Jin, Wenwen, 2025. "When nature disrupts: biodiversity risk and corporate supply chain resilience," Finance Research Letters, Elsevier, vol. 86(PC).
    • Handle: RePEc:eee:finlet:v:86:y:2025:i:pc:s1544612325017726
    DOI: 10.1016/j.frl.2025.108518
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    JEL classification:

    • Q56 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environment and Development; Environment and Trade; Sustainability; Environmental Accounts and Accounting; Environmental Equity; Population Growth
    • L14 - Industrial Organization - - Market Structure, Firm Strategy, and Market Performance - - - Transactional Relationships; Contracts and Reputation
    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill

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