ID:
M509
Tipo Insegnamento:
Obbligatorio
Durata (ore):
48
CFU:
6
SSD:
ECONOMIA DEGLI INTERMEDIARI FINANZIARI
Url:
LAW, DIGITAL INNOVATION AND SUSTAINABILITY/CLIMATE CHANGE Anno: 2
Anno:
2023
Dati Generali
Periodo di attività
Primo Semestre (11/09/2023 - 02/12/2023)
Syllabus
Obiettivi Formativi
Since the adoption of the UN Global Compact Principles in 2000 that led to the introduction of the 17 Sustainable Development Goals (SDGs), there has been a common recognition that finance plays a key role – and therefore holds a critical responsibility - in the transition towards sustainable investments and substantive justice (promoting social equality and access to economic resources for every member of society). This course aims at analyzing in detail the key aspects of the pivotal role that finance plays in the ESG transformational journey of society. We will be using a combination of lectures, structured class discussions, simulations, labs and workshops (in accordance with XLabs guidelines), and testimonials from practitioners from major public and private institutions and NGOs to analyse how market operators address in practice ESG. We will look at of how ESG is being integrated in the risk, credit, investment processes and the transformational impact on any aspect of the financial cycle. We will also provide an overall critical viewof the evolution of regulation at European and global level on the various pillars of ESG including taxonomy, disclosure, transparency in reporting standards, and corporate governance. The course welcomes students with different backgrounds, interested in understanding the interplay between the financial system, and the pursuit of welfare goals related to environmental protection, social development and transition to a carbon neutral economy. Students will analyze actual debt or equity transactions within the sustainable space,familiarize with sustainable, green, transition, social and impact financeprinciples and/or standards, and climate due diligence Q&A, focus on the actual decision-making process of asset managers investors when assessing sustainability risks and sustainability factors relevant to their investments. The course will also address the potential andactual impact of ESG on corporate finance and capital allocations, on accounting rules and regulatory capital of financial institutions.
Prerequisiti
Students can easily follow the analytical content of this course if they have a basic knowledge and understanding of corporate law and financial markets, corporate finance, macroeconomic and microeconomics
Metodi didattici
Slides will be available before the lesson covering each of the specific topics addressed in the course. Students will be expected to read selected reference material before the relevant lesson. Hence, the traditional presentation of the analytical problems can be concise and leave room to Q&A and discussions. Experts from corporates, asset managers, banks, EU institutions, regulators and supra nationals will give presentations and participate in panels in specific issues.
Verifica Apprendimento
The assessment of students learning will be centered mainly on written outputs and their presentation (60% of the final grade), and class participation including students’ presentation, Q&A on topics discussed during the lectures, participation and involvement in labs and class debate
(40% of the final grade). Hence active participation is a key aspect in for the evaluation. There will be time for feedback and suggestions for how to improve the course going forward.
(40% of the final grade). Hence active participation is a key aspect in for the evaluation. There will be time for feedback and suggestions for how to improve the course going forward.
Testi
The analysis of very recent or current issues means that it is impossible to refer to a specific textbook. The slides, referring to a given lesson, will be made available to students in advance. However, in order to have a general and analytical view on sustainable, social, transition and green finance, students can refer to:
UNEP FI, The Climate Risk Landscape: Mapping Climate-related Financial Risk Assessment Methodologies, UN Environment Programme, January 2021.
UNEP FI and CICERO, Pathways to Paris: A Practical Guide to climate transition scenarios for financial professionals, UN Environment Programme, February 2021.
Andersson, M., P. Bolton and F. Samama (2016) ‘Hedging Climate Risk’, Financial Analysts Journal, 72(3): 13-32.
Fisher, P. (Ed.). (2020), Making the Financial System Sustainable. Cambridge: Cambridge University Press.
Dirk Schoenmaker (2017), Investing for the common good: a sustainable finance framework, Ed. Stephen Gardner, Bruegel Essay and Lecture Series.
T. Walker et al. (eds.) (2018), Designing a Sustainable Financial System, Palgrave Studies in Sustainable Business In Association with Future Earth.
Gregor Dorfleitner, Sebastian Utz & Maximilian Wimmer (2018) Patience pays off – corporate social responsibility and long-term stock returns, Journal of Sustainable Finance & Investment, 8:2, 132-157.
Neil Reeder, Andrea Colantonio, John Loder & Gemma Rocyn Jones (2015) Measuring impact in impact investing: an analysis of the predominant strength that is also its greatest weakness, Journal of Sustainable Finance& Investment, 5:3, 136-154.
Colin Mayer (2018), Prosperity, Oxford University Press;
Dirk Schoenmaker, Willem Schramade (2019), Principles of Sustainable Finance, Oxford University Press.
Task Force on Climate-related Financial Disclosures (2017) Recommendations of the Task Force on Climate-related Financial Disclosures: Final Report (Bloomberg Report),
Financial Stability Board, Basel.European Central Bank, 2020, Guide on climate-related and environmental risks.
United Nations (2015) ‘UN Sustainable Development Goals (UN SDGs) -Transforming our world: the 2030 Agenda for Sustainable Development’,A/RES/70/1, New York.
Margherita Giuzio, Dejan Krusec, Anouk Levels, Ana Sofia Melo, Katri Mikkonen and Petya Radulova (May 2019), Climate change and financial stability, ECB Financial Stability Review.
Aaron Maltais & Björn Nykvist (2020): Understanding the role of green bonds in advancing sustainability, Journal of Sustainable Finance &Investment.
Molly Scott Cato & Cory Fletcher, 2020, Introducing sell-by dates for stranded assets: ensuring an orderly transition to a sustainable economy, Journal of Sustainable Finance & Investment, 10:4, 335-348.
UNEP FI, The Climate Risk Landscape: Mapping Climate-related Financial Risk Assessment Methodologies, UN Environment Programme, January 2021.
UNEP FI and CICERO, Pathways to Paris: A Practical Guide to climate transition scenarios for financial professionals, UN Environment Programme, February 2021.
Andersson, M., P. Bolton and F. Samama (2016) ‘Hedging Climate Risk’, Financial Analysts Journal, 72(3): 13-32.
Fisher, P. (Ed.). (2020), Making the Financial System Sustainable. Cambridge: Cambridge University Press.
Dirk Schoenmaker (2017), Investing for the common good: a sustainable finance framework, Ed. Stephen Gardner, Bruegel Essay and Lecture Series.
T. Walker et al. (eds.) (2018), Designing a Sustainable Financial System, Palgrave Studies in Sustainable Business In Association with Future Earth.
Gregor Dorfleitner, Sebastian Utz & Maximilian Wimmer (2018) Patience pays off – corporate social responsibility and long-term stock returns, Journal of Sustainable Finance & Investment, 8:2, 132-157.
Neil Reeder, Andrea Colantonio, John Loder & Gemma Rocyn Jones (2015) Measuring impact in impact investing: an analysis of the predominant strength that is also its greatest weakness, Journal of Sustainable Finance& Investment, 5:3, 136-154.
Colin Mayer (2018), Prosperity, Oxford University Press;
Dirk Schoenmaker, Willem Schramade (2019), Principles of Sustainable Finance, Oxford University Press.
Task Force on Climate-related Financial Disclosures (2017) Recommendations of the Task Force on Climate-related Financial Disclosures: Final Report (Bloomberg Report),
Financial Stability Board, Basel.European Central Bank, 2020, Guide on climate-related and environmental risks.
United Nations (2015) ‘UN Sustainable Development Goals (UN SDGs) -Transforming our world: the 2030 Agenda for Sustainable Development’,A/RES/70/1, New York.
Margherita Giuzio, Dejan Krusec, Anouk Levels, Ana Sofia Melo, Katri Mikkonen and Petya Radulova (May 2019), Climate change and financial stability, ECB Financial Stability Review.
Aaron Maltais & Björn Nykvist (2020): Understanding the role of green bonds in advancing sustainability, Journal of Sustainable Finance &Investment.
Molly Scott Cato & Cory Fletcher, 2020, Introducing sell-by dates for stranded assets: ensuring an orderly transition to a sustainable economy, Journal of Sustainable Finance & Investment, 10:4, 335-348.
Contenuti
The course is divided into six main parts.
The first part provides an introductory overview over the history of the rise of ESG, the Sustainable Development Goals and sustainable development and analyses a definition of E, S and G and related metrics. It focuses on the various types of finance caught by the definition of “green and sustainable finance”.
The second part gives an introduction to climate and environmental risks, and the various stages of transition.
The third part provides a summary of the main legal, regulatory and soft and hard law frameworks (including EU Taxonomy) for sustainable development and green and sustainable finance, by analysing the ongoing transformation of the financial system both from a regulatory and operational standpoint by considering initiatives of policymakers and the infrastructure, governance, due-diligence, decision-making process and monitoring by market operators when carrying out financial decisions and investment informed by ESG criteria while fostering Net Zero.
The fourth part focuses on reporting standards and ESG ratings. Students will look at the core and structure of sustainability reports.
The fifth part explores how policymakers can help fostering sustainable finance and Net Zero banks and investors can foster Net Zero.
The sixth part of the course focuses on the various impact, social, green and sustainable finance equity and debt instruments, on the standards applicable (eg IFC, ICMA and LMA principles) and how these products are used by corporates in their capital structure, by asset managers in their portfolio allocations and by commercial banks in their loan book.
The first part provides an introductory overview over the history of the rise of ESG, the Sustainable Development Goals and sustainable development and analyses a definition of E, S and G and related metrics. It focuses on the various types of finance caught by the definition of “green and sustainable finance”.
The second part gives an introduction to climate and environmental risks, and the various stages of transition.
The third part provides a summary of the main legal, regulatory and soft and hard law frameworks (including EU Taxonomy) for sustainable development and green and sustainable finance, by analysing the ongoing transformation of the financial system both from a regulatory and operational standpoint by considering initiatives of policymakers and the infrastructure, governance, due-diligence, decision-making process and monitoring by market operators when carrying out financial decisions and investment informed by ESG criteria while fostering Net Zero.
The fourth part focuses on reporting standards and ESG ratings. Students will look at the core and structure of sustainability reports.
The fifth part explores how policymakers can help fostering sustainable finance and Net Zero banks and investors can foster Net Zero.
The sixth part of the course focuses on the various impact, social, green and sustainable finance equity and debt instruments, on the standards applicable (eg IFC, ICMA and LMA principles) and how these products are used by corporates in their capital structure, by asset managers in their portfolio allocations and by commercial banks in their loan book.
Risultati di Apprendimento Attesi
Knowledge and understanding:
By the end of the course, students should be able to:
• become confident in navigating key aspects of sustainable finance and develop a critical comprehension of the inner functioning of the financial ecosystem and how it impacts on social, economic and environmental development;
• understand the features of Environmental, Social and Governance sustainability, and the interaction between each other;
• comprehend how private actors, public entities, rating and impact evaluation agencies, regulatory authorities interact in the regulation and development of financial markets, in order to promote sustainable finance and study the direction of travel of a regulation for a sustainable financial system; and
• learn from, and challenge practitioners and professionals engaged with sustainable finance.
Applying knowledge and understanding:
Upon completing the study program, students will be able to:
• Understand the inner working mechanisms and legal framework of lenders, borrowers, asset managers and investors, and the relevant provisions and regulatory initiatives on Green, Social & Sustainable finance;
• effectively interact in a business environment as an expert in green, social and sustainable finance, analyse, evaluate and measure impact of possible investments in the green, sustainable and social sectors; and
• understand how equity or debt transactions for impact, green, social and sustainable purposes are carried out in practice applying internationally recognised principles through an hands-on approach.
Making judgements:
Upon completing the study program, students will be able to:
• present an informed scientific opinion in the public debate concerning initiatives to integrate sustainability considerations into its financial policy framework in order to mobilise finance for sustainable growth;
• apply both legal and economic reasoning in the main aspects of the debate on sustainable finance;
• gather and interpret information and data from different sources, in order to make judgements in an independent way; and
• prepare original research supported by relevant bibliography and data analysis, and debate different perspectives to address the issue.
Communications Skills:
Upon completing the study program, students will be able to:
• develop the ability to communicate in written form through completing the assignments and oral form through presenting assignments and subject to challenges from lecturers and the class debate;
• foster the development relational skills in international and multicultural settings;
• participate in a public policy debate, by researching and expressing expert opinions; and
• pitch investment ideas to potential investors.
Learning skills:
Upon completing the study program, students will be able to:
• build an analytic toolbox from legal, economic and policy analysis; and
• solve problems in dynamics settings and develop critical positions. This ability will be acquired through: class participation, class debate, and research carried out for the drafting of the written assignments.
By the end of the course, students should be able to:
• become confident in navigating key aspects of sustainable finance and develop a critical comprehension of the inner functioning of the financial ecosystem and how it impacts on social, economic and environmental development;
• understand the features of Environmental, Social and Governance sustainability, and the interaction between each other;
• comprehend how private actors, public entities, rating and impact evaluation agencies, regulatory authorities interact in the regulation and development of financial markets, in order to promote sustainable finance and study the direction of travel of a regulation for a sustainable financial system; and
• learn from, and challenge practitioners and professionals engaged with sustainable finance.
Applying knowledge and understanding:
Upon completing the study program, students will be able to:
• Understand the inner working mechanisms and legal framework of lenders, borrowers, asset managers and investors, and the relevant provisions and regulatory initiatives on Green, Social & Sustainable finance;
• effectively interact in a business environment as an expert in green, social and sustainable finance, analyse, evaluate and measure impact of possible investments in the green, sustainable and social sectors; and
• understand how equity or debt transactions for impact, green, social and sustainable purposes are carried out in practice applying internationally recognised principles through an hands-on approach.
Making judgements:
Upon completing the study program, students will be able to:
• present an informed scientific opinion in the public debate concerning initiatives to integrate sustainability considerations into its financial policy framework in order to mobilise finance for sustainable growth;
• apply both legal and economic reasoning in the main aspects of the debate on sustainable finance;
• gather and interpret information and data from different sources, in order to make judgements in an independent way; and
• prepare original research supported by relevant bibliography and data analysis, and debate different perspectives to address the issue.
Communications Skills:
Upon completing the study program, students will be able to:
• develop the ability to communicate in written form through completing the assignments and oral form through presenting assignments and subject to challenges from lecturers and the class debate;
• foster the development relational skills in international and multicultural settings;
• participate in a public policy debate, by researching and expressing expert opinions; and
• pitch investment ideas to potential investors.
Learning skills:
Upon completing the study program, students will be able to:
• build an analytic toolbox from legal, economic and policy analysis; and
• solve problems in dynamics settings and develop critical positions. This ability will be acquired through: class participation, class debate, and research carried out for the drafting of the written assignments.
Criteri Necessari per l'Assegnazione del Lavoro Finale
Passion for the subject and achieving top marks in the examination.
Corsi
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LAW, DIGITAL INNOVATION AND SUSTAINABILITY
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