Green Sentiment, Stock Returns, and Corporate Behavior

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Environmental considerations, especially those related to the pressing issue of climate change, are playing an increasingly prominent role in financial markets. Factors driving this trend include the intensification of extreme weather events, the increase in public awareness on environmental issues, and the regulatory developments of recent years. Despite a growing emphasis on the importance of green finance by both practitioners and policy-makers, our collective understanding on the effect of environmental concerns on financial markets and corporate decisions remains limited.

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