Improved informational eﬃciency will help them protect their balance sheets from risks that may have been neglected so far. What is more, mandatory climate risk disclosure will not only improve ﬁnancial risk management but may also promote the green transition.
In fact, several studies have shown that mandatory disclosure of climate risks can lead to considerable reductions in carbon emissions. [11] Ralph Waldo Emerson might have already known one reason why.