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Investor Rewards to Environmental Responsibility in the COVID-19 Crisis

Investor Rewards to Environmental Responsibility in the COVID-19 Crisis
Author: Alexandre Garel
Publisher:
Total Pages: 47
Release: 2020
Genre:
ISBN:

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The COVID-19 shock and its unprecedented financial consequences have brought about vast uncertainty concerning the future of climate actions. We study the cross-section of stock returns during the COVID-19 shock to explore investors' views and expectations about environmental issues. The results show that firms with responsible strategies on environmental issues experience better stock returns. This effect is mainly driven by initiatives addressing climate change (e.g., reduction of environmental emissions and energy use), is more pronounced for firms with greater ownership by investors with long-term orientation and is not observed prior to the COVID-19 crisis. Overall, the results indicate that the COVID-19 shock has not distracted investors' attention away from environmental issues but on the contrary led them to reward climate responsibility to a larger extent.


Firms’ Environmental Performance and the COVID-19 Crisis

Firms’ Environmental Performance and the COVID-19 Crisis
Author: Pierre Guérin
Publisher: International Monetary Fund
Total Pages: 25
Release: 2021-03-19
Genre: Business & Economics
ISBN: 1513574493

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The shutdown in economic activity due to the coronavirus disease (COVID-19) crisis has resulted in a short-term decline in global carbon emissions, but the long-term impact of the pandemic on the transition to a low-carbon economy is uncertain. Looking at previous episodes of financial and economic stress to draw implications for the current crisis, we find that tighter financial constraints and adverse economic conditions are generally detrimental to firms’ environmental performance, reducing green investments. The COVID-19 crisis could thus potentially slow down the transition to a low-carbon economy. In light of the urgent need to reduce global greenhouse gas emissions, these findings underline the importance of climate policies and green recovery packages to boost green investment and support the energy transition. Policies that support the sustainable finance sector, such as improved transparency and standardization, could further help mobilize green investments.


Sustainable Finance and the Global Health Crisis

Sustainable Finance and the Global Health Crisis
Author: Pasquale Marcello Falcone
Publisher: Taylor & Francis
Total Pages: 275
Release: 2023-08-01
Genre: Business & Economics
ISBN: 1000921662

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The speed with which the various economies recover from the Covid-19 pandemic will significantly determine the economic pressure placed on the environment in the medium-to-long-term. Furthermore, the pandemic has highlighted the strong interrelations between natural and societal systems, with societal resilience depending on a resilient environmental support system. In this context, the book argues that the pandemic represents a wake-up call for financial systems to be better prepared for the climate crisis and social risk, and has provided a stimulus to scale down the reliance of the global economy on fossil fuels. The first part of the book provides a deep and creative discussion between leading international researchers and experts on the policy options and financial instruments which can help to catalyze the green finance transition in the post-Covid-19 era. The contributions show that sustainable finance is emerging as a powerful tool to advance the transition towards a more environmentally and socially sustainable economic model. Instruments such as sovereign green bonds, green securities, and other sustainability-related securities can play a significant role in the post-Covid-19 world to fund economic stimulus and to lead the way to new and more sustainable future. The second part of the book supports the debate by highlighting a number of selected case studies on financing transitions in different regional contexts including Africa, Asia, Europe, and Latin America. The book marks a significant contribution to the literature on environmental economics and finance, climate change, and sustainability transitions.


Deconstructing ESG Scores: How to Invest with Your Own Criteria?

Deconstructing ESG Scores: How to Invest with Your Own Criteria?
Author: Torsten Ehlers
Publisher: International Monetary Fund
Total Pages: 56
Release: 2023-03-10
Genre: Business & Economics
ISBN:

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Environmental, Social, and Governance (ESG) scores are a key tool for asset managers in designing and implementing ESG investment strategies. They, however, amalgamate a broad range of fundamentally different factors, creating ambiguity for investors as to the underlying drivers of higher or lower ESG scores. We explore the feasibility and performance of more targeted investment strategies based on specific ESG categories, by deconstructing ESG scores into their granular components. First, we investigate the characteristics of the various categories underlying ESG scores. Not all types of ESG categories lend themselves to more focused strategies, which is related to both limits to ESG data disclosure and the fundamental challenge of translating qualitative characteristics into quantitative measures. Second, we consider an investment scheme based on the exclusion of firms with the lowest scores in a given category of interest. In most cases, this strategy allows investors to substantially improve the ESG category score, with a marginal impact on financial performance relative to a broad stock market benchmark. The exclusion results in regional and sectoral biases relative to the benchmark, which may be undesirable for some investors.We then implement a “best-in-class” strategy by excluding firms with the lowest category scores and reinvesting the proceeds in firms with the highest scores, maintaining the same regional and sectoral composition. This approach reduces the tracking error of the portfolio and slightly improves its risk-adjusted performance, while still yielding a large gain in the targeted ESG category score.


Economic Growth and Environmental Quality in a Post-Pandemic World

Economic Growth and Environmental Quality in a Post-Pandemic World
Author: Muhammad Shahbaz
Publisher: Taylor & Francis
Total Pages: 337
Release: 2023-07-28
Genre: Business & Economics
ISBN: 1000892859

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In response to the damage caused by a growth-led global economy, researchers across the world started investigating the association between environmental pollution and its possible determinants using different models and techniques. Most famously, the environmental Kuznets curve hypothesizes an inverted U-shaped association between environmental quality and gross domestic product (GDP). This book explores the latest literature on the environmental Kuznets curve, including developments in the methodology, the impacts of the pandemic, and other recent findings. Researchers have recently broadened the range of the list of drivers of environmental pollution under consideration, which now includes variables such as foreign direct investment, trade expansion, financial development, human activities, population growth, and renewable and nonrenewable energy resources, all of which vary across different countries and times. And in addition to CO2 emissions, other proxies for environmental quality – such as water, land, and ecological footprints – have been used in recent studies. This book also incorporates analysis of the relationship between economic growth and the environment during the COVID-19 crisis, presenting new empirical work on the impact of the pandemic on energy use, the financial sector, trade, and tourism. Collectively, these developments have improved the direction and extent of the environmental Kuznets curve hypothesis and broadened the basket of dependent and independent variables which may be incorporated. This book will be invaluable reading for researchers in environmental economics and econometrics.


Enhancing Sustainability Through Non-Financial Reporting

Enhancing Sustainability Through Non-Financial Reporting
Author: Monteiro, Albertina
Publisher: IGI Global
Total Pages: 329
Release: 2023-10-16
Genre: Business & Economics
ISBN: 1668490781

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The lack of transparency and accountability in organizations has made it difficult to identify, measure, and disclose their sustainable practices and impacts, creating a challenge for global sustainability efforts. Furthermore, there is a lack of consensus on the determinants and impacts of non-financial information reporting. In response to these challenges, Enhancing Sustainability Through Non-Financial Reporting, a book edited by Albertina Monteiro, Ana Pinto Borges, and Elvira Vieira, offers a comprehensive analysis of the relationship between sustainability practices and reporting, and the accounting, finance, and management fields. This book provides a platform for both academics and practitioners to share their empirical and theoretical research on the contributions of organizations to sustainable development, the determinants and impacts of non-financial information reporting, the role of sustainability reporting standards, and the challenges faced by accounting, finance, management, and auditing. It is an essential resource for anyone seeking to enhance sustainability through non-financial reporting and is relevant to a wide range of audiences, including academics, practitioners, and other interested individuals and groups.


The Impact of the COVID-19 Pandemic on Green Societies

The Impact of the COVID-19 Pandemic on Green Societies
Author: Chinmay Chakraborty
Publisher: Springer Nature
Total Pages: 434
Release: 2021-03-22
Genre: Science
ISBN: 3030664902

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This book covers the sustainability issues of a green environment towards economics and society in terms of alteration in industrial pollution levels, effect of reduced carbon emissions, changes in water bodies characteristics with respect to heavy metal contamination, monitoring of associated impact with respect to ecology and biodiversity, impact of reduced noise levels and air quality influences on human health, handling and management of biomedical waste. According to WHO, 80% of people living in urban areas are exposed to air exceeding safe limits. The advent of "sustainability‟ in development science has led planners to apply evolving notions of "sustainability‟ to the contemporary debate over how cities and regions should be revitalized, redeveloped, and reformed. Market allocation of resources, sustained levels of growth and consumption, an assumption that natural resources are unlimited and a belief that economic growth will „trickle down‟ to the poor have been its hallmarks. The recent advance technology helps to promote green and clean modern societies continuously. The Internet of things will be playing an important role in the upcoming years in environment protection and sustainable development. There is a focus on paradigm shift in the sustainable development for the green environment during the period of isolation of COVID-19. This is the moment for the mobilization against the climate crisis. The sudden fall in pollutants and subsequent blue skies signifies a dramatic shift for India and also other affected countries during this period. Fighting climate change requires a collaborative approach between all spheres of society unlike the former. It must heavily redirect resources towards local, sustainable activities, including education, health, sustainable agriculture and circular management of resources. The impact of COVID-19 pandemic which has resulted in the dramatic change in the different aspects of the environment. The global lockdown has led to a rejuvenation of nature, ecosystems, biodiversity. Even urban environments are discovering a degree of peace and serenity, which led to decrease in greenhouse gas emission.