Speaker
Description
During the past decade, researchers have shown growing interest in the intersection between climate risks and financial decision-making, giving rise to a steadily expanding body of multidisciplinary research. However, this literature remains highly fragmented, with reviews varying considerably in terms of scope, methodology, theoretical framework, and geographical focus. To date, no comprehensive systematic literature review has been conducted to consolidate the main academic contributions to this intersection. Existing reviews either focus on environmental finance, green bonds, or sustainability reporting or are limited to regulatory analyses within developed economies. There is, therefore, a lack of a structured synthesis charting the fundamental research questions, methodological trends, and conceptual gaps that define this field. This review fills this gap by systematically analysing the most cited peer-reviewed articles published between 2015 and 2025 on climate risk and finance. In doing so, it provides a coherent overview of current knowledge, highlights neglected areas of research, and lays a foundation for future empirical work.
The review is based on three complementary theoretical perspectives that serve as lenses for interpreting the literature reviewed. First, institutional theory provides insight into how companies and financial institutions adopt climate-related practices, including disclosure, ESG alignment, and climate scenario analysis, both to manage risk and to gain and maintain legitimacy in the eyes of regulators, investors, and international markets. Second, stakeholder theory focuses on the role of internal and external actors (e.g., shareholders, institutional investors, civil society, and regulators) in determining organisational behaviour, especially in terms of climate accountability and transparency demands. Third, risk management theory gives us a technical basis for understanding how climate-related uncertainties are evaluated and dealt with through financial strategies, including capital allocation, hedging, and discount rate adjustments. Combined, these frameworks are employed to frame the analysis and interpret the prevailing themes in the selected literature, to identify trends, gaps, and the implications for emerging economies such as Morocco.
This review adopts a systematic literature review (SLR) approach, guided by the PRISMA (Preferred Reporting Items for Systematic Reviews and Meta-Analyses) methodology to ensure both transparency and structure. The review was conducted using the Web of Science (WoS) database, with a target search using the keywords “climate risk” and “finance”. The filters were applied to include only peer-reviewed articles published between 2015- 2025, written in English, classified in the categories “Business”, “Finance”, and “Economics”, and available in open access. The initial search yielded more than 700 results. After removing duplicates and excluding reviews that did not directly address the relationship between climate risk and financial decision-making, the 30 most cited articles were selected as the final set, ensuring the inclusion of high-impact contributions.
To complete this review, a descriptive analysis was conducted to chart trends in publication, identify prevailing themes, and highlight geographical imbalances in research. This analysis supported the objective of the review: to identify the knowledge gained, the gaps, and how these findings can inform future research and policy development in the context of emerging economies, particularly in Morocco.
The systematic review reveals four main themes in the included articles. First, climate risks are getting more and more recognised as big financial risks, affecting asset pricing, discount rates, sovereign borrowing costs, and companies’ decisions on capital structure. It seems that physical risks and transition risks affect market behaviour and institutional performance. Second, the literature consistently highlights the importance of climate risk disclosure and transparency, showing that high-quality reporting improves investor confidence and access to capital, particularly among institutional investors. Third, there is increasing interest in financial instruments and strategies, such as green bonds, climate insurance, and hedging mechanisms, which aim to integrate climate risk in financial operations and long-term planning. Finally, the descriptive analysis reveals a clear regional disparity: most empirical research focuses on developed economies (Europe, North America, and parts of Asia), while emerging markets, particularly in Africa and the MENA region, remain largely underrepresented in peer-reviewed academic work. Morocco, in particular, is absent from the most cited empirical reviews, highlighting the need for regionally specific financial resilience strategies and policy frameworks.
The findings of the review highlight a persistent asymmetry between global developments in climate finance research and its implementation in emerging economies. While the academic community has made significant progress in modelling, disclosing, and pricing climate risks in developed markets, such tools remain insufficiently attuned to the institutional, economic, and regulatory contexts of countries such as Morocco. The paucity of peer-reviewed studies focused on Morocco highlights two issues: a knowledge gap and a practical vulnerability. In the absence of a thorough understanding of how climate risks are perceived and managed at the local level, financial institutions may be poorly equipped to contribute to national adaptation goals. The review also suggests that frameworks such as the Task Force on Climate-related Financial Disclosures (TCFD) and the EU taxonomy, while useful in high-governance environments, require institutional adaptation to be relevant in more fragmented or resource-constrained contexts. This paper represents a key step toward filling this gap by consolidating international research and identifying key areas for empirical research and policy innovation in the MENA region.
Key Words: Climate risk – Climate finance – Financial decision-making – Emerging markets
