Climate Risk Disclosures. The Risk Perception Perspective

Organizations and institutions publish climate risk disclosures to provide information related to their carbon footprint and exposures to climate-related risks. While frameworks for climate-related risk disclosures, such as the Task Force on Climate-related Financial Disclosures (TCFD) have advanced this practice, challenges remain. Criticisms especially focus on some disclosures being more performative than substantive, focusing on improving the public image rather than driving meaningful impact. This paper explores in depth the mechanisms and relationships through which climate risk disclosures shape risk perceptions and further transferring risk and reliabilities among entities. It also examines how climate risk disclosures affect the understanding of both stakeholders and the broader public, and the extent to which they are enabling more risk-informed decision-making. To achieve this objective, we draw on insights from contemporary risk science with the main focus on risk perception research and current climate risk disclosure practices.

Keywords: Climate risk disclosure, Climate risk, Risk perception, Risk science, TCFD, Climate policy.