Module Catalogue 2024/25

Pre Requisite Comment

N/A

Co Requisite Comment

N/A

Aims

This module introduces students to the so-called green finance and its linkages to sustainable investments in the context of climate change and the transition to a carbon-neutral economy. The module examines financial sustainability through the lenses of agency, stakeholder, and other theories. Moreover, it supports students in understanding the role of green financial instruments in promoting sustainability and how these are linked to climate-related risks in the banking and financial markets. Students are exposed to a range of risk management approaches and investment frameworks, which are currently used to identify and quantify the risks related to climate change. The module also analyses the role of institutional investors like banks and that of supervisory authorities and governments in aligning financial markets with social, environmental, and government goals.

Outline Of Syllabus

Indicative content

•The social and environmental challenges in the economy and the environmental goals
•What is financial sustainability and why is it important in a business context?
•The role of the financial sector and other institutions in the transition to the green economy
•Financial sustainability through the lenses of agency and stakeholder theories
•Corporate responsibility and Governance in the context of the ESG framework
•The current stage of ESG in the UK and internationally
•Carbon-neutral and low-carbon policies in promotion of sustainability
•Financial policy instruments and the environmental regulatory and supervisory frameworks
•Climate-related financial products
•Environmental risk modelling

Intended Knowledge Outcomes

On successful completion of this module students will be able to:
1.Understand how carbon-related policies that promote sustainability affect the decision-making process in corporate firms and financial institutions
2.Analyse the risks and opportunities across different asset classes and financial actors as a result of the climate change
3.Demonstrate the challenges, opportunities and advantages which are linked to the ESG principles
4.Discuss the different approaches in environmental risk modelling
5.Present the range of financial policy instruments and initiatives along with the environmental regulatory and supervisory frameworks

Intended Skill Outcomes

Overall, the module aims to help students to obtain the necessary skills to:
1.Work and do research in the cutting-edge area of finance and environment that is increasingly becoming a key topic for financial institutions, financial markets, and financial authorities.
2.Critically evaluate the challenges for the global financial system, which emerge from the climate change.
3.Analyse how to use green financial instruments to promote sustainability.
4.Demonstrate the role of the financial sector in the transition to a sustainable economy.



Textbook references
Gray, R., Adams, C. A., and Owen, D., 2014. Accountability, social responsibility and sustainability: Accounting for society and the environment. Harlow: Pearson.

Sachs, J. D., Woo, W. T., Yoshino, N., Taghizadeh-Hesary, F., 2021. Handbook of Green Finance: Energy Security and Sustainable Development. Springer.

Schoenmaker, D., Schramade, W., 2021. Principles of Sustainable Finance. Oxford University Press.

Thomson, S., 2021. Green and Sustainable Finance: Principles and Practice. Chartered Banker Institute Series.

Teaching Rationale And Relationship

The learning environment consists of lectures and seminars, combined with in-class learning activities. Lectures are based on formal notes that present, discuss, and analyse the key theories, concepts, tools, and techniques which lie behind sustainability and green finance. Formal notes are supplemented by journal articles, policy research papers, and market-based reports. Seminars illustrate the material covered in lectures and are mainly based on case studies, numerical and real-life examples to help students to acquire a more practical and day-to-day view of the material covered in lectures.

Assessment Rationale And Relationship

Students are typically expected to take a closed-book written examination at the end of the semester. Examination will consist of numerical, practical, and theoretical/conceptual questions. All questions will be based on the material covered in lectures and seminars and also on any additional readings and in-class discussions.

General Notes

N/A