Published Online:October 2024
Product Name:The IUP Journal of Accounting Research & Audit Practices
Product Type:Article
Product Code:IJARAP061024
Author Name:Egurla Kishan and V Usha Kiran
Availability:YES
Subject/Domain:Finance
Download Format:PDF
Pages:102-129
The paper investigates the linkages between climate change and stock market return performance of BRICS economies. It focuses on greenhouse gas (GHG) emissions—CO2, CH4, N2O, F-gas—as climate change variables to analyze the linkages with BRICS nations’ stock market returns from 1993 to 2020. To test the linkages and short-run and long-run relationships between climate change and stock market returns, Johansen’s cointegration and Vector error correction models have been applied. The results confirm the positive long-run relationship of MSCI Brazil with CO2, N2O, F-gas emissions; MSCI India with CO2, CH4, N2O, F-gas emissions; MSCI China with CH4, N2O, F-gas emissions; and MSCI South Africa with CO2, CH4, N2O, F-gas emissions. The results also show a negative long-run relationship between MSCI China and CO2; MSCI Brazil and CH4; and MSCI emerging markets and CO2, CH4, N2O, F-gas emissions. It is also found that all the BRICS stock market returns show mixed relationships, and only MSCI emerging markets returns have been significantly associated with CO2, CH4, N2O, F-gas emissions in the short run.
Climate change imposes significant impacts on natural, economical and social dimensions of the global society. It disrupts the entire world in manifold ways, i.e., global warming, abnormal weather systems, extreme heat waves, rising sea level, droughts, floods and also damages to the socioeconomic and environmental development of the society.