The E-axes Forum on Climate Change, Macroeconomics, and Finance

Zacharias Sautner

“Do Investors Care About Biodiversity?”

Event description

From the Abstract: This paper introduces a new measure of a firm’s negative impact on biodiversity, the corporate biodiversity footprint, and studies whether it is priced in an international sample of stocks. On average, the corporate biodiversity footprint does not explain the cross-section of returns between 2019 and 2022. However, a biodiversity footprint premium (higher returns for firms with larger footprints) began emerging in October 2021 after the Kunming Declaration, which capped the first part of the UN Biodiversity Conference (COP15). Consistent with this finding, stocks with large footprints lost value in the days after the Kunming Declaration. The launch of the Taskforce for Nature-related Financial Disclosures (TNFD) in June 2021 had a similar effect. These results indicate that investors have started to require a risk premium upon the prospect of, and uncertainty about, future regulation or litigation to preserve biodiversity.


Anastasia Pappas
Founder, E-Axes Forum

Zacharias Sautner

Zacharias is Professor of Sustainable Finance at University of Zurich and Senior Chair at the Swiss Finance Institute. He works on sustainable finance, ESG, climate finance, and biodiversity finance. Through his research on ESG topics, he provides insights on how finance can contribute to a more sustainable future. He is an Associate Editor at the Review of Financial Studies, Management Science, Journal of Financial and Quantitative Analysis, Journal of Banking & Finance, and Journal of Corporate Finance, a Regular Research Visitor at the ECB, and an advisor of asset management companies on sustainable finance issues. He is a Director of the European Finance Association.

Paper and slides

"Do investors care about biodiversity?" (Paper)

"Do Investors Care about Biodiversity?" (Slides)



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