This paper develops a supply-demand framework to quantify and decompose the effects of investor demand on corporate financing and investment. The framework extends demand-based asset pricing models by incorporating endogenous corporate decisions. Using Gabaix and Koijen (2024)'s granular instrumental variable approach, I estimate the model parameters and find that a $1 investor flow generates $0.012 in share issuance within the first quarter and a cumulative $0.24 over two years. Similarly, a 1% investor flow increases firm investment by 0.19% over two years. The results reveal significant asymmetry: firms respond more strongly to inflows than to outflows. Counterfactual analysis shows that investor preferences substantially dampen firms' investment responses to flows. The framework also provides a novel tool to evaluate firms' role in stabilizing the stock market.

We construct a market-based, forward-looking measure--the price valuation gap between high- and low-emission firms--to capture the multifaceted effects of climate change on publicly-listed firms. We validate the measure by showing that high-emission firms have lower price valuation ratios than low-emission firms in the same country, especially in recent years. This gap is linked to improved climate policies and increased awareness following local natural disasters. Under price pressure, high-emission companies reduce carbon emissions, enhance green innovation, and downsize operations. Private high-emission firms do not exhibit similar trends. Our findings clarify the ongoing debate regarding the productivity of sustainable investing.

We analyze class action litigation as a corporate governance device. Firms that have lower internal governance standards and those with fewer external monitors are more likely to be indicted. Lawsuits announcements are salient information to the market, as firms, on average, lose 12.3% without a reversal up to three years following the first court date, which points at a substantial reputation loss. Indicted firms readjust their operations, meanwhile sophisticated investors decrease their positions. Stock market activity surges for firms suspected of fraud, and a conservative trading strategy yields significant returns over the subsequent period. Lawsuits also affect competitors both through competitive and contagion channels.