The 328th Wenlan Financial Forum

Abstract：

There is a growing trend of firms applying emerging technologies, such as AI and alternative energies, for climate solutions. This paper provides a systematic analysis of this new economic phenomenon (ClimateTech). We use LLM contextual functions (e.g., dependency parsing) to analyze firm press releases and identify ClimateTech projects. Our findings indicate that early adopters of ClimateTech tend to have strong technological expertise in leadership.ClimateTech concentrates on two different types of technology investment: infrastructure and environmental technology. The former helps firms mitigate risk, as infrastructure can be used for both environmental and other applications, whereas environmental technology is with exclusive purpose. We observe a slightly higher proportion of firms investing in infrastructure (86%) comparing to environment tech (36%). When examining financial value and environmental impact, we find that infrastructure technology generates higher financial returns but has a lower environmental impact. In contrast, environmental technology contributes less to financial value but leads to significant environmental impact. Additionally, we identify an alternative way firms use to enhance financial value through ClimateTech: integrating it into their core products rather than using it for side businesses or image management. Enhanced green products can also increase financial value, though their environmental impact remains mixed.

Speaker Introduction：

Sean Cao is a tenured associate professor in the Department of Accounting at the Smith School of Business, University of Maryland. He previously held a joint tenured associate professorship in both the Department of Accounting and the Department of Finance at the Robinson College of Business, Georgia State University. Professor Cao's primary research areas include: corporate information disclosure and decision-making, and financial and accounting data analytics (primarily involving unstructured data processing and deep learning). His research has been published in top-tier accounting and finance journals such as the Journal of Financial Economics, Journal of Accounting Research, The Accounting Review, Contemporary Accounting Research, and IEEE Computer, among others. His work has been presented at research-intensive universities including Stanford University, Cornell University, the University of Virginia, the University of Minnesota, and Pennsylvania State University. He has also been invited to participate in seminars hosted by globally renowned companies such as Grant Thornton, Ant Financial, Baidu, and JD.com. Currently, Professor Cao serves as a guest editor for the big data special section of the top-tier journal Management Science and is a reviewer for leading journals including the Review of Financial Studies, Management Science, Contemporary Accounting Research, MIS Quarterly, and Accounting, Organizations and Society.