The PRI Academic Seminar Series invites leading ESG experts to present their research to academic scholars and investors.

The aim of the series is to:

  • give world thought leaders in responsible investing the opportunity to present their work and obtain valuable feedback
  • provide an opportunity to junior scholars to network with the speaker and obtain career advice
  • be more inclusive and strengthen our global PRI Academic Network community throughout the year

Laura Starks, 4 December 2020

Paper: Climate Regulatory Risks and Corporate Bonds

Abstract: Examining how climate and other environmental regulatory risks affect bond risk and pricing, we find that bond credit ratings and yield spreads appear to be influenced by a firm’s environmental performance along with its regulatory conditions. Firms with poor environmental profiles tend to have lower credit ratings and higher yield spreads, particularly when the firm is located in a state with more stringent environmental regulations. Using the Paris Agreement as a shock to expected climate regulation, we provide evidence of a causal relation between climate regulatory risks and the credit ratings and yield spreads of bonds with problematic environmental profile.


About Laura

Laura is the Charles E. and Sarah M. Seay Regents Chair in Finance, McCombs School of Business, University of Texas at Austin.

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Luigi Zingales, 6 November 2020

Paper: Exit vs. Voice

Abstract: We study the relative effectiveness of exit (divestment and boycott) and voice (engagement) strategies in promoting socially desirable outcomes in companies. We show that in a competitive world exit is less effective than voice in pushing firms to act in a socially responsible manner. Furthermore, we demonstrate that individual incentives to join an exit strategy are not necessarily aligned with social incentives, whereas they are when well-diversified investors are allowed to express their voice. We discuss what social and legal considerations might sometimes make exit preferable to voice.

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About Luigi

Luigi is the Robert C. McCormack Distinguished Service Professor of Entrepreneurship and Finance, and Charles M. Harper Faculty Fellow, Booth School of Business, University of Chicago 

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