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Environmental Hazards and Risk Management in the Financial Sector: A Systematic Literature Review


  • Miriam Breitenstein
  • Duc Khuong Nguyen
  • Thomas Walther


We conduct a systematic literature review on environmental and climate related risk management in the financial sector. The systematic literature review identified a total of 36 relevant articles. A formal coding leads to the aggregation and classification of papers to three main categories that consider the impact of environmental concerns on financial risk, the current state of environmental risk practices in the finance sector, and lastly measures to assess those risks within financial institutions. Our results put forward the risk reduction for financial institutions which highly commit with environmental responsibility and performance. More importantly, investors’ increase in awareness and willingness to assess climate-related financial risk would incentivize corporate managers to adopt more proactive environmental policies and practices. These findings also allow for intriguing discussions about several alleys for future research.

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  • Miriam Breitenstein & Duc Khuong Nguyen & Thomas Walther, 2019. "Environmental Hazards and Risk Management in the Financial Sector: A Systematic Literature Review," Working Papers on Finance 1910, University of St. Gallen, School of Finance.
  • Handle: RePEc:usg:sfwpfi:2019:10

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    References listed on IDEAS

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    2. Elena Georgopoulou & Sebastian Mirasgedis & Yannis Sarafidis & Vassiliki Hontou & Nikos Gakis & Dimitri Lalas & Foteini Xenoyianni & Nikos Kakavoulis & Dimitris Dimopoulos & Vrassidas Zavras, 2015. "A methodological framework and tool for assessing the climate change related risks in the banking sector," Journal of Environmental Planning and Management, Taylor & Francis Journals, vol. 58(5), pages 874-897, May.
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    18. Toms, Steven & Anderson, Keith & Salama, Aly, 2009. "Does Community and Environmental Responsibility Affect Firm Risk? Evidence from UK Panel Data 1994-2006," The York Management School Working Papers 49, The York Management School, University of York.
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    Cited by:

    1. Neil Gunningham, 2020. "A Quiet Revolution: Central Banks, Financial Regulators, and Climate Finance," Sustainability, MDPI, vol. 12(22), pages 1-22, November.
    2. Breitenstein, Miriam & Anke, Carl-Philipp & Nguyen, Duc Khuong & Walther, Thomas, 2019. "Stranded Asset Risk and Political Uncertainty: The Impact of the Coal Phase-out on the German Coal Industry," MPRA Paper 101763, University Library of Munich, Germany.

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    Environment; Climate; Risk Management; Banking; Financial Institutions;
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