Financing a Sustainable Future
Financing a Sustainable Future
Podcast Description
The Initiative in Sustainable Finance (ISF) was established as part of the LSE Global School of Sustainability to apply academic rigour to the study of the incentives the private sector has to finance a sustainable future.
In this podcast, Dr Tom Gosling, Professor in Practice in LSE, talks to academics about their research in a way accessible to practitioners and the general public.
To learn more about the Initiative in Sustainable Finance, visit https://www.fmg.ac.uk/isf
Podcast Insights
Content Themes
The podcast covers topics related to sustainable finance, climate risk integration in banking, and incentives for green lending, with episodes delving into specific issues such as the role of bank capital requirements in addressing climate change and the implications of these financial regulations.
The Initiative in Sustainable Finance (ISF) was established as part of the LSE Global School of Sustainability to apply academic rigour to the study of the incentives the private sector has to finance a sustainable future.
In this podcast, Dr Tom Gosling, Professor in Practice in LSE, talks to academics about their research in a way accessible to practitioners and the general public.
To learn more about the Initiative in Sustainable Finance, visit https://www.fmg.ac.uk/isf
Martin Oehmke (LSE) talks to Tom Goslingabout his paper A Theory of Socially Responsible Investment, co-authored with Marcus Oppof the Stockholm School of Economics.
The paper develops a model of socially responsible investment anchored in the corporate finance decision faced by a firm. With a choice between dirty and (more expensive) clean technology.
Martin explains how socially responsible investors can induce the firm to pivot to the cleaner choice. To have impact socially responsible investors have to care about reducing externalities (rather than just investing in clean firms) and have to be prepared to offer something profit seeking investors do not: in effect accepting a lower than market return. The requirement for responsible investors to trade-off returns for impact is a central finding of the model. But profit seeking investors still matter, and in combination profit seeking and responsible investors may cause greater scaling of green production than responsible investors by themselves. Impact funds need to be clear about the trade-off they are making between externality reduction and returns.
Host: Tom Gosling Contributor: Martin Oehmke
Read the paper: A Theory of Socially Responsible Investment
To learn more about the Initiative in Sustainable Finance (ISF), visit ISF's website.
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