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Research Interests
institutional investors, responsible investing, climate finance, historical finance, fintech, innovation, cryptocurrencies, decentralized autonomous organizations (DAOs)
Working Papers
Decarbonizing Institutional Investor Portfolios: Helping to Green the Planet or Just Greening Your Portfolio?, with , Simon Glossner, Philipp Krueger, and Pedro Matos
Abstract: We study how institutional investors that join climate-related investor initiatives decarbonize their equity portfolios. Decarbonization can be achieved either by re-weighting portfolios towards lower carbon emitting firms or alternatively via targeted engagements with portfolio companies to reduce their emissions. Our findings indicate that portfolio re-weighting is the predominant greening strategy by climate-conscious investors , in particular by those based in countries with carbon emissions pricing schemes. We do not uncover much evidence of engagement even after the 2015 Paris Agreement. Furthermore, we find no evidence that climate-conscious investors allocate capital towards firms developing climate patents, but they do re-weight towards firms starting to generate green revenues. Overall, our analysis raises doubts about the effectiveness of investor-led initiatives in reducing corporate emissions and helping an all-economy transition to “green the planet”.
Presentations: Darden Finance Brown Bag Series in April 2022, ICPM (International Centre for Pension Management) Spring Discussion Forum in June 2022*, the Cornell University ESG Investing Research Conference in July 2022, PRI Academic Network Week 2022, the ECGI Conference on Responsible Capitalism in September 2022*, the 2022 Research Symposium on ESG Investing in Private Markets in September 2022*, FMA Annual Meeting in October 2022, the 2023 FMA Napa/Sonoma Conference in March 2023*, MFA Annual Meeting in March 2023, Inquire Europe seminar in March 2023*, Drexel Corporate Governance Conference in April 2023*, 2023 UVA Postdoctoral Research Symposium in May 2023, 6th World Symposium on Investment Research in May 2023*, World Bank in February 2023*, 12,the Portuguese Finance Network Conference in July 2023*, 2023 EFA conference in August 2023*, upcoming presentation at the 2024 AFA Conference in January 2024*;
Prizes: 2022 Geneva Institute of Wealth Management 15,000 CHF Grant, Best Paper Award at the 12th Portuguese Finance Network Conference (2023)
Media Coverage: Institutional Investor, ESG Investor
Abstract: This paper investigates the implications for firm equity value and ownership structure when a large institutional investor publicly excludes a firm from its portfolio due to unethical behaviour. To achieve this, it makes use of the GPFG's ethical exclusions. On average, firms lose 1.72% of equity value around exclusion announcements, which is not reversed in the short term. For firms excluded under the product criteria, the effect seems to be driven by the divesting behaviour of ethics-sensitive investors.
Presentations: Mutual Funds, Hedge Funds and Factor Investing Conference, Strategy and Tactics for Effective Engagement Seminar, (poster) Cambridge ESRC DTP Annual Lecture,European Commission Conference on Promoting Sustainable Finance, (poster) Fourth Geneva Summit on Sustainable Finance, Inaugural Irish Academy of Finance (IAF) Conference,Norway Ministry of Finance, Annual Conference, Cambridge Endowment for Research in Finance, Lunch Seminar, UCLA Anderson, PhD Students Seminar, Cambridge Endowment for Research in Finance, Lunch Seminar
Debt, Data, and Decarbonisation: A research agenda for a systems demonstrator fossil fuel phase-out bond index project, with Ellen Quigley
Abstract: This article outlines a research agenda for a novel corporate bond index research project underpinning investors’ efforts to achieve three objectives: (1) divert primary market capital away from fossil fuel expansion, (2) increase the cost of capital for fossil fuel expansionists, and (3) strengthen public discourse opposing the financing of fossil fuel expansionism. In presenting a research programme that includes quantitative analysis, qualitative case studies, and experimental methods, we propose a set of research questions to examine whether and to what extent investors’ use of index-based exclusions and inclusions affects targeted firms’ financing costs, capital-raising capacity, investment or underwriting decisions, and ultimately their expansion and phase-out activities. The research agenda also addresses fossil fuel financiers and insurers as well as the underexplored question as to whether and how investors can influence social discourse through their investment, engagement, and communications activities. The research programme aligns with investor efforts to advance the goals of key international climate agreements such as the Paris Agreement and the proposed Fossil Fuel Non-Proliferation Treaty (FFNPT). The research agenda aims to address critical gaps in the sustainable finance literature by investigating how debt markets influence fossil fuel expansion and phase-out, how bond issuance affects firms’ financing conditions, and how investors can deploy index exclusions as financial deterrents and as catalysts for social and institutional change.
* indicates presentation by co-author.
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