Table 9. Co-opted directors and climate...

Table 9.

Co-opted directors and climate risk disclosure – difference-in-differences analysis

Panel A: Comparison of treatment and control firms
Dependent variables	N	Treated	N	Control	Differences	t-statistics
Total climate risk disclosure	231	0.130	231	0.101	0.028**	2.05
Control variables	N	Treated	N	Control	Differences	t-statistics
BGD	231	0.194	231	0.194	−0.001	−0.06
Ln_BSIZE	231	2.405	231	2.393	0.012	0.70
CEO Board Member	231	0.931	231	0.948	−0.017	−0.78
GOV Index	231	0.617	231	0.625	−0.008	−0.44
ROA	231	0.056	231	0.062	−0.007	−1.50
Sales Growth	231	0.023	231	0.019	0.004	0.33
MTB	231	1.790	231	1.895	−0.106	−1.34
Ln_Firm Size	231	9.454	231	9.533	−0.079	−0.78
CAPX_AT	231	0.054	231	0.049	0.005	1.03
Leverage	231	0.295	231	0.284	0.012	0.82
Cash Holding	231	0.109	231	0.121	−0.011	−1.03
R&D_AT	231	0.013	231	0.015	−0.002	−0.90
M&A	231	0.294	231	0.355	−0.061	−1.39
Ln FAGE	231	2.166	231	2.203	−0.037	−0.28
Panel B: Co-opted directors and climate risk disclosure − DiD regression
	Total climate risk disclosure
	(1)		(2)	(3)		(4)
Co-option_t * 2-Year POST CEO Turnover	0.070* (1.75)
Co-option (TW)_t * 2-Year POST CEO Turnover			0.100** (2.33)
Co-option (Independence)_t * 2-Year POST CEO Turnover				0.067 (1.53)
Co-option (TW Independence)_t * 2-Year POST CEO Turnover						0.096* (1.95)
Co-option_t	−0.054* (−1.80)
Co-option (TW)_t			−0.071** (−2.47)
Co-option (Independence)_t				−0.050 (−1.59)
Co-option (TW Independence)_t						−0.068** (−1.96)
Two-year POST CEO Turnover	−0.012 (−0.70)		−0.005 (−0.40)	−0.008 (−0.45)		−0.002 (−0.13)
All other controls	Yes		Yes	Yes		Yes
State FE	Yes		Yes	Yes		Yes
Industry FE	Yes		Yes	Yes		Yes
Year FE	Yes		Yes	Yes		Yes
Observations	462		462	462		462
Adjusted R²	0.264		0.267	0.263		0.264

Notes:

This table presents regression results for the relationship between co-opted directors and climate risk disclosure using difference in difference (DiD) around CEO exogenous turnover. Panel A presents the univariate mean comparisons between treatment and control firms’ characteristics and their corresponding t-statistics. Panel B presents the results of DiD regressions on the matched sample. All regressions incorporate controls for the fixed effects of state, industry and years. The t-statistics indicated in the parentheses are computed using standard errors cluster at firm-year. The significance levels are denoted by ***(1% significance level), **(5% significance level) and *(10% significance level)

Source: Developed by the authors

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Panel A: Comparison of treatment and control firms
Dependent variables	N	Treated	N	Control	Differences	t-statistics
Total climate risk disclosure	231	0.130	231	0.101	0.028**	2.05
Control variables	N	Treated	N	Control	Differences	t-statistics
BGD	231	0.194	231	0.194	−0.001	−0.06
Ln_BSIZE	231	2.405	231	2.393	0.012	0.70
CEO Board Member	231	0.931	231	0.948	−0.017	−0.78
GOV Index	231	0.617	231	0.625	−0.008	−0.44
ROA	231	0.056	231	0.062	−0.007	−1.50
Sales Growth	231	0.023	231	0.019	0.004	0.33
MTB	231	1.790	231	1.895	−0.106	−1.34
Ln_Firm Size	231	9.454	231	9.533	−0.079	−0.78
CAPX_AT	231	0.054	231	0.049	0.005	1.03
Leverage	231	0.295	231	0.284	0.012	0.82
Cash Holding	231	0.109	231	0.121	−0.011	−1.03
R&D_AT	231	0.013	231	0.015	−0.002	−0.90
M&A	231	0.294	231	0.355	−0.061	−1.39
Ln FAGE	231	2.166	231	2.203	−0.037	−0.28
Panel B: Co-opted directors and climate risk disclosure − DiD regression
	Total climate risk disclosure
	(1)		(2)	(3)		(4)
Co-option_t * 2-Year POSTCEO Turnover	0.070* (1.75)
Co-option (TW)_t * 2-YearPOST CEO Turnover			0.100** (2.33)
Co-option (Independence)_t *2-Year POST CEO Turnover				0.067 (1.53)
Co-option (TW Independence)_t *2-Year POST CEO Turnover						0.096* (1.95)
Co-option_t	−0.054* (−1.80)
Co-option (TW)_t			−0.071** (−2.47)
Co-option (Independence)_t				−0.050 (−1.59)
Co-option (TW Independence)_t						−0.068** (−1.96)
Two-year POST CEO Turnover	−0.012 (−0.70)		−0.005 (−0.40)	−0.008 (−0.45)		−0.002 (−0.13)
All other controls	Yes		Yes	Yes		Yes
State FE	Yes		Yes	Yes		Yes
Industry FE	Yes		Yes	Yes		Yes
Year FE	Yes		Yes	Yes		Yes
Observations	462		462	462		462
Adjusted R²	0.264		0.267	0.263		0.264

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