Disclosure of climate change performance and financial distress

Document Type : Research Paper

Authors

1 Master's student of Accounting, Faculty of Social Sciences, Imam Khomeini International University, Qazvin, Iran.

2 Professor of Accounting, Faculty of Social Sciences, Imam Khomeini International University, Qazvin, Iran.

Abstract

Climate change affects migration, economic growth, political stability, agricultural productivity, animal and crop losses, labor productivity, human health, and personal income and financial capabilities. Therefore, climate change can affect corporate performance and affect the financial health of companies. This study examines the impact of climate change performance disclosure on financial distress by considering the moderating role of litigation risk, audit firm size, risk committee, and audit fees. sample included all manufacturing companies listed on the Tehran Stock Exchange, and data from 131 companies were analysed between 2018 and 2024. Disclosure of climate change performance was measured according to the reporting standards published in 2017 by the Special Task Force on Climate-Related Financial Disclosure and Financial Distress according to the modified Altman model appropriate to the Iranian economic environment, and the hypotheses were tested using multivariate linear regression using the mixed data method.
Findings showed that climate change performance disclosure does not reduce financial distress.
Disclosure of climate change performance can be important data for stakeholders because, it can be useful for the board of directors to monitor and the role of management in assessing and managing climate-related risks and opportunities, helping financial markets to integrate these risks, and making more effective financial decisions by investors.

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Main Subjects

References

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Journal of Accounting Advances
Volume 18, Issue 1
September 2026
Pages 67-110

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History

  • Receive Date: 30 November 2025
  • Revise Date: 13 May 2026
  • Accept Date: 13 May 2026

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