Abstract
As global climate change intensifies, its potential risks have captured international scrutiny. This paper systematically analyzes the relationship and influence mechanism between climate risk and managerial self-interested behavior by constructing the PSR (Pressure-State-Response) model and the theoretical framework of internal and external perspectives of agency theory. The results of empirical tests using a sample of Chinese listed companies from 2010 to 2020 reveal that there is a U-shaped relationship between climate risk and managerial self-interest, implying that this will intensify managerial self-interested behavior as climate risk continues to increase to a certain stage. We also identify management discretion and donation income as internal and external influencing mechanisms. In addition, this U-shaped relationship is particularly significant in non-state-owned firms as well as in the non-energy sector. Overall, our study provides new theoretical and empirical insights into the relationship between climate risk and internal managerial behaviors of firms, and it also has important implications for both firm practice and policy making.
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