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What Role for Financial Supervisors in Addressing Environmental Risks?

Author

Listed:
  • Dirk Schoenmaker

    () (Department of Finance, Rotterdam School of Management, Erasmus University & Bruegel)

  • Rens Van Tilburg

    (Sustainable Finance Lab, Utrecht University)

Abstract

Abstract A literature is rapidly developing on financial shocks originating from ecological imbalances. These shocks can be triggered by either intensified environmental policies, clean tech breakthroughs or due to the economic costs of crossing ecological boundaries. However, financial supervisors have so far given little attention to this ecological dimension. This allows systemic financial imbalances resulting from ecological pressures to build up and concentrate in financial institutions and markets. This paper sketches the ecological dimension of the prudential policy framework and illustrates the working for the case of carbon emissions.

Suggested Citation

  • Dirk Schoenmaker & Rens Van Tilburg, 2016. "What Role for Financial Supervisors in Addressing Environmental Risks?," Comparative Economic Studies, Palgrave Macmillan;Association for Comparative Economic Studies, vol. 58(3), pages 317-334, September.
  • Handle: RePEc:pal:compes:v:58:y:2016:i:3:d:10.1057_ces.2016.11
    DOI: 10.1057/ces.2016.11
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    References listed on IDEAS

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    8. Renneboog, Luc & Ter Horst, Jenke & Zhang, Chendi, 2008. "Socially responsible investments: Institutional aspects, performance, and investor behavior," Journal of Banking & Finance, Elsevier, vol. 32(9), pages 1723-1742, September.
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    Cited by:

    1. J. Nieto, MarĂ­a, 2017. "Banks and Environmental Sustainability: Some reflections from the perspective of financial stability," CEPS Papers 12503, Centre for European Policy Studies.
    2. repec:gam:jsusta:v:10:y:2018:i:2:p:328-:d:129025 is not listed on IDEAS

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