This study explores the influence of climate risk on properties of firms’ financial reporting practices using observations collected from 76 countries between 2005 and 2016. We use a country-level climate risk indicator developed by Germanwatch to measure the degree of damage from extreme weather events, and find that climate risk positively influences firms’ engagements in accruals-based and real earnings management, and negatively affects conditional and unconditional conservative reporting. Furthermore, we document that the above-mentioned main effects of climate risk is enhanced for firms operating in countries with a high quality governance. Our findings, which are supported by a battery of robustness tests, have important implication for regulators and policymakers.