A great success for the Climate Change, Credit Risk and Covid 19 Workshop

Written on 12 Nov 2020.

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A great success for the online workshop organised by the "Long-Term Investors Lab” of the University of Turin and EDHEC-Risk Institute, with almost 400 people registered to learn from top experts on fixed-income implications of climate change and covid.


The Covid-19 emergency seems to have increased attention towards long-term issues like sustainable investments and development goals, climate risks and green transition. European public authorities have linked their investment plans for the recovery from the pandemic emergency to the ‘Green Deal’.  “ESG” funds have increased their weight in the market, becoming the investment trend of the past few months.

In the credit market, there is an increasing awareness of the importance of complying to ESG criteria, which reflects in investment choices, valuation, credit ratings.


Hosted by Long-Term Investors@UniTO, this workshop, through a panel of market participants and experts, aimed at uncovering the main challenges of integrating climate risk-related considerations in the credit risk assessment and, consequently, in the investment process of investors.


Watch the replay


On 5 November 2020, Gianfranco Gianfrate, Professor of Finance, EDHEC Business School and Lead Expert on Climate Change and Sustainable Finance, EDHEC-Risk Institute introduced the Climate Change, Credit Risk and Covid-19 Workshop, together with Elisa Luciano, Professor of Finance, Università di Torino and Director of LTI@Unito.

Professor Francesco Profumo provided participants with an overview of the ESG principles and climate change from the point of view of both his position as an academic and in his position as president of the Compagnia di San Paolo and member of the Italian Aspen Institute.

Over the last years, the financial industry as well as its regulatory authorities have paid increasing attention to ESG related themes and valuation criteria. Compliance to the ESG factors has become increasingly important for all kind of financial institutions and especially for long -term investors who have a greater responsability into the society. The recent Covi 19 crisis and the policies envisaged by public authorities for the recovery has strengthened the attention towards these experts, especially to the E.


The first presentation was delivered by Enrico Bernardini, Financial Risk Management Director, Banca d’Italia, who presented "ESG, E and Climate Change: Mind the Gap! Data and Fixed Income Portfolio Construction" and examined the following issues: 

  • Climate change and credit risk - threats and management
  • ESG data materiality and suitability for sustainable investment
  • Managing fixed income portfolios with sustainability factors
  •  Covid and its effects on sustainable bond market


ESG, E and Climate Change

Download Enrico's presentation here


Then, Riccardo Rebonato, Professor of Finance, EDHEC Business School and Lead Expert on Factor Investing Fixed Income, EDHEC-Risk Institute discussed "Climate-Aware Asset Pricing" and examined the following issues: 

  • Are Integrated Assessment Models useful for asset pricing? What do they imply for fixed income?
  • Relative and absolute valuation of assets: picking winner and losers versus projecting economic growth.
  • “Doing well while doing good” – Does it work? Does it make sense?


Climate-Aware Asset Pricing

Download Riccardo's presentation here


The webinar closed with a presentation by Giorgio Baldassarri, Global Head of the Analytic Development Group (ADG), S&P Global Market Intelligence, where Giorgio is in charge of the validation of credit risk models. Rating agencies are at the critical juncture in the relationship between insurers and investors, Giorgio is one of the thought leaders in this field. He presented Climate Change: Energy Transition Risks and Opportunities for European Public Companies' Creditworthiness.


Climate change: : Energy Transition Risks and Opportunities for European Public Companies' Creditworthiness

Download Giorgio's presentation here