Value, Values, and Opportunities in Corporate Environmental Practices

We examine how sell-side analysts perceive corporate environmental practices using survey responses from 505 analysts and textual analysis of 273,664 reports covering Chinese firms from 2013-2022. Analysts devote substantial attention to environmental issues (27.6% of reports), significantly exceeding coverage of AI or cybersecurity. They predominantly adopt a value maximization approach, emphasizing financial implications over non-financial values by a wide margin. Analysts view environmental factors not solely as risks but even more so as opportunities, particularly green technologies transitions. These perceptions materially influence earnings forecasts and stock recommendations. Analysts rank regulatory frameworks and media pressure as most effective drivers of corporate environmental improvement, while institutional investors-despite extensive academic attention-have limited perceived influence. Employee influence ranks lowest. The consistency between survey responses and report content validates findings and suggests broad applicability. Overall, our findings underscore the dominance of value-driven analysis, the financial materiality of environmental opportunities alongside risks and provide empirical guidance for targeted sustainability policy interventions.