In the Name of COVID-19: Is the ECB Fuelling the Climate Crisis?

Forthcoming, Environmental and Resource Economics

15 Pages Posted: 18 Jun 2020 Last revised: 2 Jul 2020

See all articles by Theodor Cojoianu

Theodor Cojoianu

University College Dublin (UCD) - Michael Smurfit Graduate School of Business; University of Oxford - Smith School of Enterprise and the Environment

E. Collins

InfluenceMap

Andreas G. F. Hoepner

Smurfit Graduate Business School, University College Dublin; Stockholm School of Economics - Mistra Financial Systems (MFS); European Commission's Technical Expert Group for Sustainable Finance

Danny Magill

InfluenceMap

Thomas O'Neill

InfluenceMap

Fabiola Schneider

UCD Michael Smurfit Graduate School of Business

Date Written: June 18, 2020

Abstract

We offer preliminary evidence drawing on a novel dataset of corporate bonds issued in the European energy sector since January 2020 in combination with the European Central Bank’s (ECB) purchases under the Pandemic Emergency Purchase Programme (PEPP) in response to COVID-19. We show that the likelihood of an European energy company bond to be bought as part of the ECB’s programme increases with the greenhouse gas (GHG) intensity of the bond issuing firm. We also find weaker evidence that the ECB’s PEPP portfolio during the pandemic is likely to become tilted towards companies with anti-climate lobbying activities and companies with less transparent greenhouse gas (GHG) emissions disclosure. Our findings imply that, at later stages of the COVID-19 recovery, an in-depth analysis maybe necessary to understand if and if yes, why the ECB fuelled the climate crisis.

Keywords: green economic recovery, climate finance, fossil fuels, green central banking

JEL Classification: Q50; Q58

Suggested Citation

Cojoianu, Theodor and Collins, E. and Hoepner, Andreas G. F. and Magill, Danny and O'Neill, Thomas and Schneider, Fabiola, In the Name of COVID-19: Is the ECB Fuelling the Climate Crisis? (June 18, 2020). Forthcoming, Environmental and Resource Economics. Available at SSRN: https://ssrn.com/abstract=3630112 or http://dx.doi.org/10.2139/ssrn.3630112

Theodor Cojoianu (Contact Author)

University College Dublin (UCD) - Michael Smurfit Graduate School of Business ( email )

Blackrock, Co. Dublin
Ireland

University of Oxford - Smith School of Enterprise and the Environment ( email )

United Kingdom

E. Collins

InfluenceMap ( email )

40 Bermondsey Street
London, SE1 3UD
United Kingdom

Andreas G. F. Hoepner

Smurfit Graduate Business School, University College Dublin ( email )

Blackrock, Co. Dublin
Ireland

Stockholm School of Economics - Mistra Financial Systems (MFS) ( email )

MISUM
Box 6501, SE-113 83 Stockholm
Sweden

European Commission's Technical Expert Group for Sustainable Finance ( email )

2 Rue de Spa
Brussels, 1000
Belgium

Danny Magill

InfluenceMap ( email )

40 Bermondsey Street
London, SE1 3UD
United Kingdom

Thomas O'Neill

InfluenceMap ( email )

40 Bermondsey Street
London, SE1 3UD
United Kingdom

Fabiola Schneider

UCD Michael Smurfit Graduate School of Business ( email )

Blackrock
Ireland

HOME PAGE: http://https://www.smurfitschool.ie/facultyresearch/phdresearch/phdstudents/fabiolaschneider/

Here is the Coronavirus
related research on SSRN

Paper statistics

Downloads
71
Abstract Views
430
rank
355,357
PlumX Metrics