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Module

Sustainable and Responsible Finance

Module description

Sustainable finance integrates environmental, social and governance (ESG) criteria into financial decisions. This module will introduce students to the latest development of theory and practice in sustainable and responsible finance. Students will develop an understanding of the principles underlying sustainable and responsible decision-making in finance, their theoretical underpinning, and the guidelines on how to apply them in business and investment practice. The module is based on evidence from rigorous academic research. The teaching is organised in the form of weekly lectures and workshops.

Full module specification

Module title:Sustainable and Responsible Finance
Module code:BEA3028
Module level:3
Academic year:2022/3
Module lecturers:
  • Professor Chendi Zhang - Convenor
Module credit:15
ECTS value:

7.5

Pre-requisites:

None

Co-requisites:

None

Duration of module: Duration (weeks) - term 2:

11

Module aims

  • To introduce students, through research-led teaching, to cutting edge theory and practice in sustainable and responsible finance.
  • To develop a critical orientation towards the subject matter and an understanding of how the principles are applied in practice.
  • To enhance student employability through engaging students in the latest development in sustainable and responsible finance and their implications for business and investment practice.

ILO: Module-specific skills

  • 1. critically discuss, compare and contrast key sustainable and responsible finance theories;
  • 2. evaluate theory-practice links between ESG and financial decisions.

ILO: Discipline-specific skills

  • 3. critically evaluate sustainable and responsible finance concepts, theories and techniques.

ILO: Personal and key skills

  • 4. work independently and demonstrate self-motivated inquiry within the subject area;
  • 5. work effectively in a group;
  • 6. present arguments related to the module content to an audience.

Learning activities and teaching methods (given in hours of study time)

Scheduled Learning and Teaching ActivitiesGuided independent studyPlacement / study abroad
30120

Details of learning activities and teaching methods

CategoryHours of study timeDescription
Scheduled Learning and Teaching Activities20Lectures
Scheduled Learning and Teaching Activities10Workshops (all students in one weekly session)
Guided Independent Study120Reading, research, reflection; preparation for lectures, workshops and assessments

Formative assessment

Form of assessmentSize of the assessment (eg length / duration)ILOs assessedFeedback method
Discussion of academic papersAssigned academic papers1-6Oral feedback from the module lead
Presentation of the proposal (group)5-minute oral presentation in the workshop1-6Oral feedback from the module lead

Summative assessment (% of credit)

CourseworkWritten examsPractical exams
20800

Details of summative assessment

Form of assessment% of creditSize of the assessment (eg length / duration)ILOs assessedFeedback method
Presentation of real-life cases (group)2020-minute oral presentation in workshop and accompanying slides1-6Oral feedback from the class and written feedback from the module lead
Exam802 hours1-4, 6General feedback provided on ELE
0
0
0
0

Details of re-assessment (where required by referral or deferral)

Original form of assessmentForm of re-assessmentILOs re-assessedTimescale for re-assessment
Presentation of real-life cases (group) (20%)Individual written report on a case (20%, max.1,200 words) 1-6August/September Reassessment Period
Exam (80%)Exam (80%, 2 hours)1-4, 6August/September Reassessment Period

Syllabus plan

The syllabus list is indicative.

  • Responsible business and firm value
  • Sustainable and responsible investments (SRI)
  • Environmental, social and governance (ESG) and finance in practice
  • Climate finance and Impact investing
  • Board of directors and its committees
  • Shareholder stewardship and engagement
  • Shareholder protection and agency issues
  • Executive pay
  • Share repurchases
  • Mergers and acquisitions

Indicative learning resources - Basic reading

Basic readings:

Brealey, R.A., Myers, S.C., & Allen, F. (2019). Principles of corporate finance (13th ed.), New York: McGraw Hill. (Note: Selected chapters.  Earlier editions can be used).

Edmans, A. (2020). Grow the pie: How great companies deliver both purpose and profit. Cambridge: Cambridge University Press.

Further readings:

Readings to accompany each lecture will be posted online. Examples include:

 

Albuquerque, R., Koskinen, Y., Yang, S., & Zhang, C. (2020). Resiliency of environmental and social stocks: An analysis of the exogenous COVID-19 market crash, Review of Corporate Finance Studies, forthcoming.

Albuquerque, R., Koskinen, Y., & Zhang, C. (2019). Corporate social responsibility and firm risk: Theory and empirical evidence. Management Science, 65(10), 4451–69.

Benabou, R., & Tirole, J. (2010). Individual and corporate social responsibility. Economica, 77(305), 1–19.

Edmans, A. (2011). Does the stock market fully value intangibles? Employee satisfaction and equity prices. Journal of Financial Economics, 101(3), 621–40.

Friedman, M. (1970, September 13). The social responsibility of business is to increase its profits. New York Times Magazine, pp. 122-126.

Gompers, P., Ishii, J. & Metrick, A. (2003). Corporate governance and equity prices. Quarterly Journal of Economics, 118(1), 107–56.

LaPorta, R., Lopez-de-Silanes, F., Shleifer, A., & Vishny, R. (1998). Law and finance. Journal of Political Economy, 106(6), 1113-1155.

Renneboog, L., Ter Horst, J., & Zhang, C. (2008). Socially responsible investments: Institutional aspects, performance, and investor behavior. Journal of Banking & Finance, 32(9), 1723-1742.

Renneboog, L., Ter Horst, J., & Zhang, C. (2008). The price of ethics and stakeholder governance: the performance of socially responsible mutual funds. Journal of Corporate Finance, 14(3), 302-322.

Renneboog, L., Ter Horst, J., & Zhang, C. (2011). Is ethical money financially smart? Nonfinancial attributes and money flows of socially responsible investment funds. Journal of Financial Intermediation, 20(4), 562–88.

Module has an active ELE page?

Yes

Origin date

03/07/2020

Last revision date

15/03/2021