SUSTAINABLE FINANCE

This course aims to provide participants with a general understanding of the broad and growing topic of sustainable finance by discussing the recent academic literature and featuring several guest lectures of practitioners from various fields. The course covers the key aspects of sustainable finance, such as the origins of climate risk, its impact on financial markets and institutions, and the role of financial institutions in combating climate change.

The course will contain empirical and theoretical parts and include coding assignments in Python. Therefore, students must have a good understanding/command of: • Empirical finance/econometric methods • Linear algebra and analysis • Python

Knowledge and understanding By participating in the lectures and practical activities of the course, the student will gain knowledge about the importance of climate risks for financial markets and institutions. The student will understand the key aspects of climate risk, how financial markets and institutions react to it, and the role of finance in the transition to a net-zero economy. Applying knowledge and understanding The student will be able to apply the methods and tools conveyed in the course to assess financial institutions' exposure to climate risks and the effectiveness of initiatives like impact investing. Making judgements Applying the methodologies conveyed in the course, the student will have acquired problem analysis skills and the ability to identify the information necessary for their solution. Specifically, critical thinking, problem-solving, self-management, teamwork, relationship, and communication skills will be adequately developed, enhancing and making the disciplinary skills more usable. Communication skills At the end of the course, the student will be able to use the business and technical vocabulary of sustainable finance, addressing the economic issues at hand with terminological accuracy. Through the various activities that will take place during the course – lessons with discussion, guest lectures, group assignments – the student will be able to put these communication skills into practice in various contexts by adapting the terms used to the interlocutor in the specific case, thus gaining advanced rhetorical skills necessary for his/her professional career. Learning skills The technical-economic knowledge acquired during the course will allow the student to autonomously understand and interpret sustainable finance techniques and adapt them to the specific reference context. The student will develop a solid knowledge of the subject’s fundamental aspects that will allow him to deepen the topics addressed independently and work in sustainable finance-related contexts.

The course will focus on the following main topics. 1. Measuring climate risks 2. Pricing of climate risks 3. Asset management 4. Climate risk exposure of financial institutions 5. Socially responsible investing and sustainable financial instruments 6. Policies and regulatory frameworks

The course will be based on academic articles. All material will be provided in class.

Lectures, case studies, discussions, and group exercises

The final grade consists of three components: -Three group assignments. The assignment's grade counts for each member of the group. Each assignment is worth 10% of the final grade. -A group presentation in the last week of the semester. The presentation's grade counts for each member of the group. The presentation's grade is worth 20% of the final grade. -A final exam that is written individually. The exam's grade is worth 50% of the final grade.

Interview with lecturer