Science Meets Stakeholder Webinar – INTERACT

Background of the event
The Science Meets Stakeholders format aims to support the interface between research and financial management practice and provides a platform for scientists to interact with stakeholders. Goals, questions, needs and ideas are to be shared. Thus, valuable feedback on the relevance and enhancement of the research work can be provided by the stakeholders.

Agenda
In this issue the project “Green Financial Intermediation – From Demand to Impact” (INTERACT) is presented. The collaborative project “Green Financial Intermediation – From Demand to Impact” (INTERACT) aims to investigate the impact channels through which the financial sector can contribute to the achievement of climate policy goals. Based on this, policy recommendations for improving the entire process of financial intermediation are to be derived. The joint project consists of two subprojects.

The first subproject analyzes the investment behavior of private households in order to determine how “green preferences” can be channeled into sustainable investments. In addition, transmission mechanisms in capital and credit markets are investigated, which contribute to the fact that the financing conditions of an investment project depend on its climate impact. Game-theoretic modeling, experiments, and empirical analysis are used to derive market mechanisms and conditions under which investments in green projects can achieve their optimal impact.

The second subproject focuses on financial intermediation at the firm level. The aim is to investigate whether and how “green” regulation influences access to credit for small and medium-sized enterprises in particular, is reflected in differentiated credit conditions and provides incentives for companies to carry out more climate-friendly activities.
In this issue, first practical results will be presented and discussed.

Target group
The event is aimed at employees from financial institutions including savings banks as well as investment advisors.

The researchers would appreciate feedback from you on the following questions:

• What role do financial advisors and their “green preferences” play in retail investors’ investment decisions for sustainable investments? And how do retail investors take advice from financial advisors, particularly for sustainable investments?
• What drives banks’ decision to refinance with green bonds? Does this decision have a direct impact on lending?
• In what areas and how specifically do new regulations such as EU taxonomy and non-financial reporting requirements affect financial institutions (e.g. risk management, reporting, lending)? What sustainability metrics on corporate climate risks will be collected in practice when granting loans (in the future)? What does this look like for SMEs? Regarding the upcoming GAR disclosure requirement, do you expect – and if so, what – actions from financial actors in response?
• What are the main motivations for banks’ efforts to make the portfolio “greener” or more “climate resilient” (e.g. risk mitigation, doing good, customer demand, reporting requirements)? Do banks of different legal forms, sizes, customer bases, etc. differ in this regard?
• What strategies do you observe or apply to make the loan portfolio more sustainable / greener (e.g. exclusion of certain sectors, different conditions in lending, specific products like sustainability-linked loans,…)?