Showing off cleaner hands: mandatory climate-related disclosure by financial institutions and the financing of fossil energy

M sonnier Jean-St Phane and Benoît Nguyen
Authors registered in the RePEc Author Service: Jean-Stéphane Mésonnier

Working papers from Banque de France

Abstract: We investigate the real effects of mandatory climate-related disclosure by financial institutions on the funding of carbon-intensive industries. Our impact metric is the amount invested into securities, bonds and stocks, issued by fossil fuel companies. A French law, which came into force in January 2016 in the aftermath of the Paris Agreement on climate change, provides us with a quasi-natural experiment. The new regulation, unique in Europe at that time, requires institutional investors (i.e., insurers, pension funds and asset management firms), but not banks, to report annually on both their climate-related exposure and climate change mitigation policy. Using a unique dataset of security-level portfolio holdings by each institutional sector in each euro area country, we compare the portfolio choices of French institutional investors with those of French banks and all financial institutions located in other EA countries. We find that investors subject to the new disclosure requirements curtailed their financing of fossil energy companies by some 40% compared to investors in the control group.

Keywords: Bilan carbone; investisseurs institutionnels; nergie fossile; d sinvestissement. (search for similar items in EconPapers)
JEL-codes: G11 G15 G23 H55 Q54 Q56 (search for similar items in EconPapers)
Pages: 39 pages
Date: 2021
New Economics Papers: this item is included in nep-ene and nep-env
References: Add references at CitEc
Citations: View citations in EconPapers (5)

Downloads: (external link)
https://publications.banque-france.fr/sites/defaul ... /documents/wp800.pdf

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:bfr:banfra:800

Access Statistics for this paper

More papers in Working papers from Banque de France Banque de France 31 Rue Croix des Petits Champs LABOLOG - 49-1404 75049 PARIS. Contact information at EDIRC.
Bibliographic data for series maintained by Michael brassart ().