OFIN 3250A - Climate Change and Sustainable Finance

The seminar looks at how financial markets are affected by and can address the challenges of climate change and the growing trend of sustainable finance. We will review why climate changes poses a systemic risk to finance and look at ways to channel capital towards sustainable investments, including recent financial innovations. We will consider how investors incorporate sustainability and ESG factors in their investment decisions and what analytical and reporting frameworks they use. A couple of sessions will be dedicated to financing the energy transition and biodiversity preservation / restoration. Several guest speakers will share their experience in the sector and present case studies SESSION PLAN Session 1 – Navigating the maze of climate and sustainable finance topics  Introductions and overview of the seminar  What are sustainable finance, ESG, climate finance, impact investing and conservation finance ?  How have these topics become relevant to financial markets over the past few years ?  Identifying ESG based risk channels and threats to investment performance Session 2 – Climate change: a systemic risk to financial markets  Quantifying climate risk exposure  Policy and regulatory responses  Embracing climate disclosure and fostering resilience: metrics, standards and methodologies  ESG ratings and their limitations Session 3 – Channelling capital towards sustainable investments  Climate change mitigation, adaption and resilience funding needs  Sources of capital and the role of taxonomies  Characteristics of the climate bonds market  Mobilising low carbon resilient investments in developing countries Session 4 – Financing the energy transition  The electrification of the energy sector and the role of hydrogen: objectives and challenges  How do oil & gas companies implement the energy transition ?  Case study: TotalEnergies Session 5 – Biodiversity, natural capital and conservation finance: the new frontier in sustainable finance  Financing biodiversity: market trends and policy support  Implications of the UN Biodiversity CoP 15  Taskforce on Nature-related Financial Disclosures Session 6 – Innovation in sustainable finance  Sustainability-linked and target-based financings  Voluntary carbon markets  Pricing climate risks and rewarding resilience: the role of insurance

Alexandre CHAVAROT

Enseignement électif

English

Students will be expected to spend two to three hours preparing for each session. They will be given relevant book chapters, articles and background papers to read prior to each session.

Good knowledge of microeconomics and finance principles and keen interest in both the challenges of climate change and sustainability and ways to mobilize finance to address them.

Autumn 2024-2025

2 continuous assessment credits. Students will be expected to actively engage in each session through written preparation, oral interventions, and / or case studies/role plays.

6 weekly sessions of 2 hours each.