Working in Progress

[1] Biodiversity Risk, Firm Performance, and Market Mispricing. with Yujun Huang, Anna Créti and María Eugenia Sanin

Combining new data on biodiversity-capacity and biodiversity-footprint with firm fundamentals, we conduct a causal analysis of the impact of biodiversity physical risk on firms' profitability and stock returns. With this purpose, we build a biodiversity index for 35 countries and use a time series model to capture its variation over time. We show that such time trend estimation can be aggregated as risk exposure and can significantly forecast establishment-level profitability. We then show that the market underprices biodiversity physical risk, which is due to the insufficient analysis of related information and its impact on the firm-level future cash flow. We also document disparities of risk exposure across firms and sectors, and our results are consistent with previous findings in terms of climate physical risk. 

Seminar/Conference/Poster Participants at: University Paris Dauphine (LED-a), EDHEC Business School, University of Edinburgh, CREST, Banque de France, The 21th Corporate Finance Days, The EUROFIDAI-ESSEC Paris December Finance Meeting (2024), Asian Finance Association (AsianFA) Annual Meeting (2025)，FMA Euroupe (2025), HEC ARCS (2025), NYU-FED Climate finance summer meeting (2025 poster),Grasfi 2025, Science Po 2025.

[2] Shale Debt Structure and Pollution Control. with Veronika Selezneva and Mariia Cosar (Preliminary draft available under request)

This paper analyzes how firms in the shale oil industry adjusted their production in response to green policy shocks, particularly after the Paris Agreement. We find that firms with high levels of short-term debt experienced significant refinancing challenges, reflected in reduced bond issuance and decreased bank new money injection. By creating a novel index that measures toxic chemical usage at the well-level, combined with firm-level financial data, we demonstrate that high short-term debt ratio firms notably reduced their use of toxic chemicals following the policy change. Heterogeneity analyses reveal that financially healthier firms, firms with higher capital expenditure intensity, and those with more concentrated supplier bases exhibited greater pollution reductions. Changes in institutional ownership, particularly declines by banks and investment managers, further strengthened firms' environmental adjustments. 

Seminar/Conference/Poster Participants at: Rising Scholar Conference in Finance, (U Zurich & SFI, July 2025), NYU-SH & SoFiE, (planning at Aug, 2025), The 22th Corporate Finance Days, (planning at Sep, 2025)