A masters thesis in the field of finance on the topic of impact of climate change on financial markets, specifically how environmental disclosure impacts corporate financial performance. Area of research (publicly listed) EU corporations. It’s supposed to be a quantitative research.
General
topic: Climate Change
Data
set: multi-country event studies can be executed with publicly available stock
price data (e.g. Yahoo Finance world indices) or library sources (e.g. Wharton
WRDS, Datastream). Abnormal returns can be analyzed further with
country-specific determinants (economic, political, social and cultural).
Suggested sources are DataStream, Worldscope as well as data provided in the
referenced articles.
Research
question: How has climate change affected corporations and financial markets?
Methodologies:
Event study, regression analysis.
Starting
literature:
A.
C. Brooks and L. Schopohl, Green Accounting and Finance: Advancing Research on
Environmental Disclosure, Value impacts and management control systems, British
Accounting Review (2021), https://doi.org/10.1016/j.bar.2020.100973.
B.
Y. Zhang , L. Liu , M. Lan , Z. Su , K. Wang, Climate change and economic
policy uncertainty: Evidence from major countries around the world, British
Accounting Review (2024), https://doi.org/10.1016/j.eap.2024.02.003.
C.
F. Fagbemi and D. Funmilola Oke, Climate change vulnerability-foreign direct
investment linkage: Why climate change preparedness matters in Sub-Saharan
Africa, British Accounting Review (2024),
https://doi.org/10.1016/j.rie.2024.01.001.
Slots:
I:
To Disclose or Not to Disclose Climate-Change Risk in Annual Reports?
Potential
difficulties: This topic would better be researched using quantitative
analysis, e.g. regression analysis. Alternatively, this topic may be researched
using qualitative analysis, e.g. interviews and questionnaire surveys. In this
case, additional time, patience and effort may be required.
Thesis
“proposal”
Topic:
OF-22: Climate Change
Slot
H: To Disclose or not to Disclose Climate change risk in annual Reports
Main question/Title: What is the impact of
environmental disclosure on Corporate Performance. Evidence from EU countries.
H1:
High levels of environmental disclosure are associated to increased firm value
(stock price).
For this hypothesis I’d like to use
the model Qui et al. (2016) uses in their H2 as a
reference/inspiration for method and type of data (variables)
H2:
Higher levels of environmental (carbon risk in this case) disclosure are
negatively associated with cost of capital/WACC
For this hypothesis I’d like to use
the model Lemma et al. (2018) used for their H1 as a reference/inspiration for
method and type of data (variables)
H3:
Higher levels of environmental disclosure are positively associated with
expected cash flows
For this hypothesis I’d also like to
use the article of Qui et al. (2016), but in this case the model they described
for H3 as a reference/inspiration for method and type of data (variables)
Lemma,
T. T., Feedman, M., Mlilo, M., & Park, J. D. (2018). Corporate carbon risk,
voluntary disclosure, and cost of capital: South African evidence.
Business Strategy and the Environment,
28(1), 111–126. https://doi.org/10.1002/bse.2242
Qiu,
Y., Shaukat, A., & Tharyan, R. (2016). Environmental and social
disclosures: Link with corporate
financial performance. The British Accounting Review, 48(1), 102–116. https://doi.org/10.1016/j.bar.2014.10.007
STRUCTURE
Section 1: Introduction
You need to provide an outline of a researchable topic
that is focused on what you are going to address through the collection and
analysis of data rather than literature review.
You need to provide a clear and coherent outline of the
purpose and objectives of the research. You are required to specify what it is
you want to find out and why. You will need to consider the question; what will
we know once you have completed the research that we do not know now?
You need to explicitly address the following items:
· The background and issues underlying the research aims,
objectives, and questions;
· Justification for, and significance of, the research
(personal motivation is not enough; you need to embed the justification for the
research topic in the literature and provide an indication of why others might
be interested in the research).
Section 2: Literature Review
You need to develop a critical, rather than just
descriptive, review of the peer reviewed literature pertinent to the focus of the
research objectives. The literature review should be written in a narrative
style, organised under themes rather than an article by article summary of the
literature. This will have a significant impact on the grading of the proposal.
It should provide good coverage of the following:
1. Identification, description and review of the relevant
conceptual literature (theory / models / frameworks related to the research
objectives;
2. Relevant empirical literature (data based) completed
on the research focus;
3. A review of the relevant contextual literature for
your topic (covering the development of ideas central to your research focus,
recent developments, etc.)
4. Identification and review of the debates within the
literature.
Section 3: Research Strategy and Methods
Research strategy
– the overall logic that links the various research design choices
Methods and tools for collecting data and the sources of
DATA you intend to access (NOT LITERATURE) including the criteria for selection
of sector, companies, region, etc.
Nature of data you intend to collect; the kind of
questions you are going to ask, the kind of observations you are going to make,
the kind of documentary and archival sources (NOT LITERATURE) you intend to use
Access and research ethics issues to collecting your data
Techniques you intend to apply for analyzing/interpreting
data. This should provide details of the type of statistics (descriptive,
inferential, etc.) you intend to use while doing quantitative analysis.
It is vitally important that for each component of your
research design, that you provide justifications for your choices at every
stage and, where relevant, the implications of those choices.
