Download This PaperEnvironmental Hazards and Risk Management in the Financial Sector: A Systematic Literature Review
Breitenstein, Miriam; Nguyen, Duc K.; Walther, Thomas (2021): Environmental Hazards and Risk Management in the Financial Sector: A Systematic Literature Review, in: Journal of Economic Surveys, Vol. 35, No. 2, pp. 512-538. DOI: 10.1111/joes.12411 (Open Access)
University of St.Gallen, School of Finance Research Paper No. 2019/10
46 Pages Posted: 31 Jul 2019 Last revised: 31 Jan 2022
Date Written: November 16, 2020
Abstract
We conduct a systematic literature review on environmental and climate-related risk management
in the financial sector. We classify the current literature into three categories: (i) the impact of
environmental concerns on financial risk; (ii) the current state of environmental risk practices
in the financial sector; and (iii) measures to assess the financial exposure to environmental
risks. We find that financial institutions can reduce their risk exposure by highly committing
with environmental responsibility and performance. Moreover, the increase in willingness to
assess climate-related financial risk incentivizes corporate managers to adopt more proactive
environmental policies and practices.
Keywords: Environment, Climate, Risk Management, Banking, Financial Institutions
JEL Classification: G20, G32, Q51, Q54, Q56,
Suggested Citation: Suggested Citation