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. 2022 Mar 18;13(1):1451.
doi: 10.1038/s41467-022-28975-5.

Assessing the climate change exposure of foreign direct investment

Xia Li  1 , Kevin P Gallagher  2
Affiliations

Assessing the climate change exposure of foreign direct investment

Xia Li et al. Nat Commun. .

Abstract

This study deploys newly available data to examine the exposure of multinational companies' overseas investments to physical climate risks. Globally, foreign investments are significantly exposed to lower physical climate risks, compared with local firms across countries. Within countries however, the differences of physical climate risks between foreign and local facilities are small. We also examine China, as it is fast becoming one of the largest sources of outward foreign investment across the globe. We find that foreign direct investment from China is significantly more exposed to water stress, floods, hurricanes and typhoon risks across countries, compared with other foreign facilities. Within host countries however, once again the physical climate risks of Chinese overseas facilities are comparable to those of non-Chinese foreign investments.

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Conflict of interest statement

The authors declare no competing interests.

Figures

Fig. 1
Fig. 1. Paper structure and terminology.
Presents the structure of the study and explains key terminologies used in the paper.
Fig. 2
Fig. 2. Average climate risk scores of overseas facilities by industry.
Analysis is based on climate risk scores and facility statistics of 2233 public companies from Four Twenty Seven. Transportation and Communication sector includes transportation, communications, electric, gas and sanitary service.
Fig. 3
Fig. 3. Average climate risk scores of overseas facilities by host country.
Analysis based on climate risk scores and facility statistics of 2233 public companies from Four Twenty Seven. The map images are created by the authors using ArcGIS. (a) Aggregate climate risk score, (b) heat stress score, (c) water stress score, (d) floods score, (e) sea level rise score, (f) hurricanes/typhoons score.
Fig. 4
Fig. 4. Average climate risk scores of overseas facilities by headquarters country: top 15 countries by FDI outflow stock, 1970–2019.
Analysis based on climate risk scores and facility statistics of 2233 public companies from Four Twenty Seven. FDI outflow stocks based on World Bank data.
See this image and copyright information in PMC

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