Green Bonds: Price determinants, volatility transmission, and perspectives
| Autor | Natalia Garzón/Hernán Quintanilla/Jesús Molina-Muñoz/Andrés Mora-Valencia |
| Cargo del Autor | Universidad de los Andes, School of Management/Universidad del Rosario, School of Management/Universidad del Rosario, School of Management/Universidad de los Andes, School of Management |
| Páginas | 105-130 |
105
Green Bonds:
Price determinants, volatility
transmission, and perspectives
Natalia Garzón*
Hernán Quintanilla**
Jesús Molina-Muñoz**
Andrés Mora-Valencia***
Introduction
Climate change provokes losses for rms as a result of
rising sea levels, droughts, wild res, extreme heatwaves,
oods, and hurricanes, among other impacts. Further-
more, government policies, such as high carbon taxes,
may impact the share prices of companies that emit a
great amount of greenhouse gases. e International
* Universidad de los A ndes, School of Management.
** Universidad del Ro sario, School of Manageme nt.
*** Univer sidad de los Andes, School of Ma nagement.
Sustainability and management. Sostenibilidad y dirección de empresas
106
Fnance Corporation of the World Bank (2016) esti-
mated that reducing carbon emissions between 2016
and 2030 and achieving the Paris Agreement goals
will require an investment of $23 trillion. us, the
nancial markets provide an opportunity to diminish
the negative impact of climate change. On the one hand,
asset managers could provide more green investment
products. On the other hand, nancial regulators may
establish standards to encourage investments in these
types of products, and banks should begin assessing
climate risks.
Consequently, several institutional investors are
incorporating green principles into their portfolios,
and nancial advisers are beginning to educate clients
about environmental, social, and governance ()
investment alternatives. Interestingly, according to
Robo advisers,1 younger investors are increasingly
demanding investments. Furthermore, regulators
are requiring banks to report rms in which they have
investments, including direct emissions. For example,
France was the rst country to implement mandatory
environmental reporting for nancial institutions to
disclose how they include green performance into their
1 Robo adv isors manage inve stments through automated pro cesses
and algorit hms. e objectiv e is to create a persona lized inv estment
portfolio for eac h client, which considers t he preferences of users, their
conditions, thei r assets, and thei r objectives, in shor t, their investor pr ole.
Robo advisors h ave several port folios for each prole in whic h investors
are grouped. S ource: https://www.sec.gov/oiea/investor-alerts-bulletins/
ib_robo-advisers
CONTENIDO
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