Sustainable Finance

Introduction

This course aims to introduce students to the sustainability issues and ethical challenges facing today’s financial industry. It argues that the industry’s ability to generate long-term sustainable returns depends on well-functioning and well-governed markets that correctly account for ethical issues and societal and environmental risks.

This course starts with a discussion of the purpose of the company and outlines the conditions under which sustainability and ethical considerations may clash with purely financial goals. The course further asks why clients of the financial industry are increasingly demanding sustainable investment opportunities. These opportunities intend to offer competitive financial returns over the long term while also advancing sustainability goals through those investments. The course explains the strategies used to pursue sustainability goals, including negative and positive screening, ESG integration, thematic investment, corporate engagement, and impact investing.

Course content

The course will cover, among others, the following topics (content may vary from year to year):

• Purpose of the company
• Investor demand for sustainability and the many facets of sustainable investing
• Pricing of environmental, social, and governance (ESG) risks
• Can investors really do well by doing good?
• Ethics in the financial industry
• Professional codes of conduct