SUST_FINMARKET

PID2023-153128NB-I00 MCIU/AEI/10.13039/501100011033/FEDER,UE

Summary:

Widespread concern about climate change, coupled with the growing trend towards advancing a more sustainable economy in its broadest sense –encompassing environmental, social and governance aspects- is forcing a paradigm shift in investment decision-making, as well as in the structure of many sectors and in the trading dynamics of carbon and energy commodity markets, with profound implications for investors, companies and policymakers. In this context, this project is intended to contribute to the generation of knowledge in the field of sustainable investments and the adaptation of carbon and energy markets to the energy transition by addressing a number of topics that still remain largely unexplored. First, we aim to shed light on the capacity of sustainable assets and ESG considerations to improve the performance of investment portfolios. This is an aspect of undisputed importance since the existence of significant diversification opportunities associated with sustainable investments will boost the formation of a broader base of environmentally and socially conscious investors, thus favoring the mobilization of the vast amount of financial resources indispensable for a successful transition. Second, understanding the risk transmission mechanism among sustainable assets and conventional asset classes as well as the impact of ESG considerations on market risk and efficiency is crucial for the development of a powerful and healthy sustainable financial system. This information is also of undoubted usefulness to avoid potential destabilizing effects in financial markets that could threaten the credibility of the transition process itself. Third, regarding the impact of energy transition on carbon and energy markets, our aim is to contribute to a deeper understanding of the dynamics, challenges and opportunities in these markets that arise during the ongoing shift towards a more sustainable energy landscape. This will provide helpful knowledge on the role of financial investors with regards to price volatility and potential price manipulation practices, the development of a more resilient and efficient electricity market and the need for effective hedging strategies in energy markets in the face of such a changing an uncertain environment.

Financial Economics, Sustainable Finance, ESG, Energy Markets, Financial Markets

Díaz Mendoza, Ana Carmen (Senior Lecturer)

ana-carmen.diaz@unirioja.es

+info

Avinguda Tarongers, s/n.

> Ministry of Science, Innovation and Universities.

> FEDER Funds, European Union.

Information pending development.