The Academic Network Conference 2019 was the largest to date, attended by 58 academics from 46 institutions, alongside 58 investors.
The conference represents an integral aspect of the PRI’s longstanding effort to foster research and to bridge academic and investor communities. Held in Paris, the PRI encouraged academics and investors to network and discuss the latest insights on responsible investment research.
The conference had the pleasure of welcoming two great keynotes. Professor Renée B. Adams from Saïd Business School, University of Oxford, shared some of the latest research insights on gender diversity in corporate boards. In addition, Martin Spolc, Head of the Sustainable Finance and Fintech, European Commission’s Directorate General for Financial Services, gave a closing keynote covering the significant steps taken by the Commission’s Sustainable Finance initiatives.
Overall, the conference welcomed 14 academic paper presentations. The presenters came from all over the world and covered a range of responsible investment topics including institutional investor’s views on climate risk disclosure, ESG investing by mutual funds, shareholder activism and firm’s voluntary disclosure of climate change risks, amongst other topics and insights. Most of the papers and presentations can be accessed here.
This conference was developed in collaboration with the Research Chair on Sustainable Finance and Responsible Investments (Chaire FDIR) at Toulouse School of Economics and École Polytechnique. A big thank you also goes to NN Group, Barings and Edmond de Rothschild who were this year’s official conference partners.
The changes to capital markets needed to meet the global sustainability objectives must be underpinned by high quality research. The articles here represent a cornerstone of PRI’s efforts to foster research and to build bridges between the academic and practitioner communities.
Opening keynote: Women on boards: the superheroes of tomorrow?
Renée B. Adams, Saïd Business School, University of Oxford
Many countries and policymakers seem to agree that greater gender diversity on corporate boards is fundamental for economic progress. This session will:
Moderated by Will Martindale, Director of Policy and Research, PRI
Panel discussion: Disclosure of climate change risks
The results of a new comprehensive institutional investor survey on investor perceptions on firm-level climate disclosures will be discussed.
Presenter: Emirhan Ilhan, Frankfurt School of Finance & Management and Philipp Krueger, University of Geneva
Co-authors: Zacharias Sautner and Laura Starks
This examines whether shareholder activism induces management to voluntarily disclose firm’s exposure to climate risks. Overall, the findings indicate that active shareholders can elicit greater climate risk disclosure and improve corporate governance.
Presenter: Caroline Flammer, Boston University
Co-authors: Mike Toffel and Kala Viswanathan
Moderator: Edward Baker, Senior Policy Advisor, Climate and Energy Transition, PRI
Practitioner discussant: Michael Herskovich, Head of Corporate Governance, BNP Paribas Asset Management
Breakout 1A: Investor and market responses to climate
The implications of a new eco-label for mutual funds, which was introduced by Morningstar and the research finds that investors were reactive to these ratings and that some mutual funds responded by readjusting their holdings.
Presenter: Stefano Ramelli, University of Zurich
Co-authors: Marco Ceccarelli, and Alexander F. Wagner
Academic discussant: Bert Scholtens, University of St Andrews
Is ‘being green’ rewarded in the market?: An empirical investigation of decarbonization and stock returns
An examination of the risk-return relationship of low carbon-investment and characteristics of carbon-efficient firms.
Presenter: Soh Young In, Stanford University
Co-authors: Ki Young Park and Ashby Monk
Academic discussant: Marie Briere, Dauphine University, Amundi
Moderator/practitioner discussant: Michael Viehs, Associate Director – ESG Integration, Hermes
Breakout 1B: Investing and engaging on carbon
This research uses innovative data measuring, forward-looking physical climate risk at the firm level and finds that greater climate risk leads to lower leverage post-2015 and that the results are influenced by both demand and supply side factors.
Presenter: Edith Ginglinger, Université Paris-Dauphine, PSL
Co-author: Quentin Moreau
Academic discussant: Vincent Bouchet, Ecole Polytechnique
Unpacking the roles of shareholder engagement intermediaries: A case study of an engagement process on carbon risk
A qualitative case study of a three-year engagement project on carbon risk where the authors identify and conceptualise four roles performed by engagement intermediaries to elicit companies’ responses.
Presenters: Jean-Pascal Gond, Cass Business School, City, University of London and Emma Sjöström, Stockholm School of Economics
Academic discussant: Fabrizio Ferraro, IESE
Moderator/practitioner discussant: Tom Barron, Manager, Stewardship, PRI
Practitioner panel: A call to action - Bridging the gap between RI practice and academic research
Fiona Reynolds , CEO, PRI and David Harris , Group Head of Sustainable Business at London Stock Exchange Group & Head of Sustainable Investment, FTSE Russell
Academic research has the ability to inform and transform investment decision-making and practice, however academic and industry impact are often separated by a large divide. This session will highlight priority issues and challenges from investment practitioners and funding opportunities for academic research.
How academics can access PRI data
The PRI’s 2,500 signatories are required to report on their organisational structure, strategy and governance, climate change reporting and asset class specific modules. Learn about the R&A Framework and how you can use it for academic research.
Presenter: Elina Rolfe, Director, Reporting & Assessment, PRI
This is a unique private forum with data since 2008 that allows signatories to pool resources, share information and enhance their influence on ESG issues. Learn about the platform, current engagements, recent academic studies that have analysed the success of collaborative engagement on E, S and G issues, and how to access the data.
Presenter: Nabylah Abo Dehman, Manager, Social Issues, PRI
Breakout 2A: Regulation and legislation
The authors find that bond riskiness and pricing appear to be jointly determined by a firm’s environmental performance and its regulatory conditions.
Presenter: Laura Starks, University of Texas at Austin
The research finds there was a real reduction in emissions suggesting that prescriptive carbon disclosure regimes lead to greater reduction in emissions than voluntary regimes.
Presenter: Philipp Krueger, University of Geneva
Co-author: Valentin Jouvenot
Breakout 2B: Corporate misconduct, reputation and director discretion
The paper finds that the relation between financial and non-financial misconduct varies both over time and by the type of violation.
Presenter: Aneesh Raghunandan, London School of Economics
Academic discussant: Nadja Guenster, Munster University
An unexpected corporate data breach is studied to investigate how firms respond to negative reputation events and finds that these breaches negatively affect firm value and that in response, firms increase their ESG investment.
Presenter: Pat Akey, University of Toronto
Co-authors: Stefan Lewellen and Inessa Liskovich
Academic discussant: Xavier Giroud, Columbia University
This paper analyses the relationship between enhanced director’s stakeholder orientation and firm value.
Presenter: Scott B. Guernsey, University of Cambridge
Co-authors: Simone Sepe and Martjn Cremers
Academic discussant: Pedro Matos, University of Virginia
Moderator/practitioner discussant: Sebastien Thevoux-Chabuel, ESG Analyst and Portfolio Manager, Comgest
Panel discussion: Challenges in ESG measurement
Accurately measuring investment impact has been historically challenging. In addition, finding objective and standardised metrics for evaluating corporate ESG factors is still an ongoing task. To add clarity to this discussion, this session will:
Presenters: Rajna Gibson Brandon, University of Geneva
Co-authors: Philipp Krueger, Nadine Riand and Peter S. Schmidt
Academic discussant: Patricia Crifo, Ecole Polytechnique
Moderator and practitioner speaker: Mikael Homanen, PRI and Cass Business School
Practitioner discussant: Mark W. McDivitt, Managing Director – Global Head of ESG, State Street Corporation
The PRI Award for Outstanding Research
Student prize: Does environmental performance help firms’ value to recover faster from environmental controversies: International evidence
Presenter: Muhammad Ullah, University of Clermont Auvergne
Quantitative prize: ESG Shareholder Engagement and Downside Risk
Presenter: Andreas G.F. Hoepner, University College Dublin
Co-authors: Ioannis Oikonomou, Zacharias Sautner, Laura T. Starks, Xiao Y. Zhou
Awards presented by Martin Skancke, Chair, PRI