Climate risk and financial disclosure in salmon aquaculture

Abstract

The growth of the salmon aquaculture industry has attracted an increasing number of investors. Investors are conscious of economic consequences of climate change for the salmon farming companies, hence their demand for climate-related financial disclosure has increased. This study discusses potential climate-related financial impacts imposed on the salmon aquaculture production as identified by the Task Force on Climate-related Financial Disclosure (TCFD). We use data from 2016 to 2021 available on the Carbon Disclosure Project (CDP) platform, and we show to what extent salmon aquaculture companies disclose their climate-related risks. We find that when the demand of investors for climate-related financial disclosure increases, more firms tend to comply with their requests, while based on the CDP’s evaluation system, the firms perform better in minimizing their carbon impact. We argue that when salmon aquaculture companies publish their climate-related financial disclosure, they ensure transparency for their investors and secure a smooth transition into a low carbon economy.