Franck Moraux (Université de Rennes, CREM) Titre: Optimal Dividend Policy under Global Warming  Abstract: Global warming affects the payout policy of heat-sensitive firms by shortening their economic lifetime, thereby reducing the option value of retained cash and inducing earlier dividend distributions. A firm-specific heat-tolerance threshold determines when business activity ceases, translating the projected temperature trajectory into a finite operating horizon, and yielding a finite-horizon, time-inhomogeneous version of the classical De Finetti dividend problem. We characterize the optimal dividend policy analytically and complement the analysis with numerical solutions of the associated HJB quasi-variational inequality. The optimal dividend barrier declines over time and converges to zero as climate-induced business termination approaches, reflecting the progressive loss of the option value of retained cash. The barrier increases with business risk and decreases with the discount rate, while its response to expected cash-flow growth is non-monotonic. We also analyze a one-time irreversible adaptation investment, showing that adaptation may be value-enhancing and that an optimal adaptation effort exists under mild cost conditions. Finally, extending the model to stochastic temperature dynamics shows that the declining dividend barrier is not an artifact of deterministic warming trajectories. Unlike in the deterministic model, firms may optimally retain positive cash reserves for distribution at climate-induced business termination. A joint work with Moussa Diakho (Université de Rennes, CREM). Link to the article.