Abstract Climate governance has historically grappled with regulatory deadlock over corporate accountability for the climate crisis. Within this context of regulatory impasse, climate disclosure emerged as the central framework in financial regulatory approaches to climate change. Extending theories of legal endogeneity to advance socio-legal studies of climate governance, this article explains how private actors institutionalized climate disclosure from a voluntary corporate practice into a cornerstone of international accounting standards and financial regulation. Drawing on seventy-four interviews with sustainability professionals, fifteen months of participant observation, and analysis of public documents, this article shows how climate finance practitioners from a key nongovernmental organization, the Carbon Disclosure Project, repurposed financial disclosure toward the disclosure of climate metrics, developed increasingly specific iterations of metrics that formed the basis of climate disclosure standards, and stabilized voluntary climate disclosure within reporting standards by incorporating climate into financial risk management. This analysis contributes to charting the development of corporate climate governance in two ways. First, cooperation from the financial community and corporations was secured by incorporating climate issues within information-based risk management approaches that used financial disclosure as a tool to facilitate the flow of climate information between companies and investors. Second, the institutionalization of climate disclosure within financial regulation reframed climate change into new forms of risk to companies, rather than accounting for the risks companies pose to the climate and environment.
Jingyi Huang (Fri,) studied this question.