Effect of biodiversity risk on upside and downside returns

Muhammad Tahir Suleman

doi:10.1016/j.econlet.2026.112830

Effect of biodiversity risk on upside and downside returns

Muhammad Tahir Suleman

Research output: Contribution to journal › Article › peer-review

Abstract

This study examines how biodiversity risk, as indicated by biodiversity disclosures in corporate 10-K reports, affects both upside and downside risks. By analysing 36,313 firm-year observations of USA firms, we find that higher exposure to biodiversity risk is associated with increased upside and downside risks. Our results remain consistent using different proxies for biodiversity risk and controlling for endogeneity.

Original language	English
Article number	112830
Journal	Economics Letters
Volume	260
DOIs	https://doi.org/10.1016/j.econlet.2026.112830
State	Published - Feb 2026

Bibliographical note

Publisher Copyright:
© 2026 Elsevier B.V.

Keywords

Biodiversity
Downside risk
Regulation
Upside risk

ASJC Scopus subject areas

Finance
Economics and Econometrics

Access to Document

10.1016/j.econlet.2026.112830

Cite this

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abstract = "This study examines how biodiversity risk, as indicated by biodiversity disclosures in corporate 10-K reports, affects both upside and downside risks. By analysing 36,313 firm-year observations of USA firms, we find that higher exposure to biodiversity risk is associated with increased upside and downside risks. Our results remain consistent using different proxies for biodiversity risk and controlling for endogeneity.",

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AB - This study examines how biodiversity risk, as indicated by biodiversity disclosures in corporate 10-K reports, affects both upside and downside risks. By analysing 36,313 firm-year observations of USA firms, we find that higher exposure to biodiversity risk is associated with increased upside and downside risks. Our results remain consistent using different proxies for biodiversity risk and controlling for endogeneity.

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