Climate-risk narrative attention and carbon emissions: internal governance and coal efficiency as moderators, green innovation as a mitigating channel

Abstract

Global decarbonization hinges on corporate behavior, yet principal–agent conflicts often undermine firms’ responses to climate change. Despite growing regulatory and stakeholder pressure, managers may prioritize short-term performance over long-term environmental goals when they perceive climate risks as distant or uncertain. Building on the growing literature on corporate climate risk, disclosure, carbon performance, and governance, this study applies a principal–agent lens to examine how climate-risk narrative attention (expressed climate-risk perception, Risk)—climate- and carbon-related language intensity in annual reports, not managers’ private beliefs—relates to firm-level carbon emissions (CO 2 e) among Chinese A-share listed firms from 2011 to 2024. We document a positive association: denser climate-related narrative attention is linked to higher CO 2 e under China’s institutional setting. A principal–agent reading can organize that pattern; we do not directly test short-termism or incentive horizons. We further show that stronger internal controls weaken this positive slope (moderation), and assigned province–industry coal productivity is associated with a flatter slope in coal-relevant industries, while green patenting is positively associated with Risk and negatively associated with CO 2 e in the same year—conditional correlations, not causal mediation. The perception–emission link is stronger among firms with low digital transformation, state-owned enterprises, non-high-tech firms, and those in less market-oriented regions.