The Sustainability–Financial Risk Nexus

Marco Migliorelli ()
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Marco Migliorelli: IAE Université Paris 1 Panthéon-Sorbonne (Sorbonne Business School)

Chapter Chapter 1 in Sustainability and Financial Risks, 2020, pp 1-29 from Palgrave Macmillan

Abstract: Abstract This chapter gives an overview of the relationship nowadays linking sustainability-related risks (stemming from climate change, environmental degradation, social inequality, policy and technology shifts) and financial risks. Two main conclusions highlight the importance of this nexus. First, the expected consolidation of sustainability-related risks in the near future has the potential to produce a widespread impact on the financial results of both banks and insurance companies. Second, the full consideration by financial actors of sustainability-related risks may lead in some geographical areas and for some economic sectors to significant pricing adjustments and to new market failures (in terms of credit cutbacks and non-insurability of risks). The chapter concludes by proposing a structured taxonomy systematically linking sustainability-related risks and financial risks.

Keywords: Sustainability-related risks; Climate change-related risks; Physical risk; Transition risk; Financial risks; Sustainable finance (search for similar items in EconPapers)
Date: 2020
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Persistent link: https://EconPapers.repec.org/RePEc:pal:psifcp:978-3-030-54530-7_1

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DOI: 10.1007/978-3-030-54530-7_1

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