The City Never Sleeps, But When Will Investment Banks Wake Up to the Climate Crisis?

Regional Studies (Forthcoming)

32 Pages Posted: 4 Mar 2021 Last revised: 17 Sep 2021

See all articles by Theodor Cojoianu

Theodor Cojoianu

Edinburgh Business School - The University of Edinburgh

Andreas G. F. Hoepner

Smurfit Graduate Business School, University College Dublin; European Commission's Platform on Sustainable Finance

Fabiola Schneider

Dublin City University Business School; European Commission's Platform on Sustainable Finance

Michael Urban

University of Oxford

Anh Vu

Queen's University Belfast; University College Dublin (UCD) - Michael Smurfit Graduate School of Business

Dariusz Wojcik

University of Oxford, St. Peter's College

Date Written: September 5, 2021

Abstract

Using a global dataset of over 840,000 equity, bond and syndicated loan investment banking deals, we build the fossil fuel investment brokerage profile of financial centres worldwide between 2000 and 2018. We also study whether city-level fossil fuel divestment commitments and country level green banking policies impact the profile of fossil fuel financial centres over our study timeframe. We find that several financial centres shift their fossil fuel investment brokerage profiles substantially, including the asset classes which they are active in. However, we do not find any evidence that this is driven by city-level divestment commitments. We do find however that fossil fuel investment banking brokers situated in financial centres exposed to voluntary green banking policies reduce their fossil fuel financing. This is driven by foreign brokers whose behaviour signals an anticipation of forthcoming mandatory green finance policies.

Keywords: fossil fuel financial centres, fossil fuel divestment, green banking policies, brokerage

JEL Classification: G20; G30; Q28; Q32; Q38; Q50

Suggested Citation

Cojoianu, Theodor and Hoepner, Andreas G. F. and Schneider, Fabiola and Urban, Michael and Vu, Anh and Wojcik, Dariusz, The City Never Sleeps, But When Will Investment Banks Wake Up to the Climate Crisis? (September 5, 2021). Regional Studies (Forthcoming), Available at SSRN: https://ssrn.com/abstract=3759048 or http://dx.doi.org/10.2139/ssrn.3759048

Theodor Cojoianu (Contact Author)

Edinburgh Business School - The University of Edinburgh ( email )

Old College
South Bridge
Edinburgh, Scotland EH8 9JY
United Kingdom

Andreas G. F. Hoepner

Smurfit Graduate Business School, University College Dublin ( email )

Blackrock, Co. Dublin
Ireland

European Commission's Platform on Sustainable Finance ( email )

2 Rue de Spa
Brussels, 1000
Belgium

Fabiola Schneider

Dublin City University Business School ( email )

Collins Ave Ext, Whitehall
Dublin
Ireland

European Commission's Platform on Sustainable Finance

2 Rue de Spa
Brussels, 1000
Belgium

Michael Urban

University of Oxford ( email )

Mansfield Road
Oxford, Oxfordshire OX1 4AU
United Kingdom

Anh Vu

Queen's University Belfast ( email )

University Rd, Belfast , United Kingdom
Belfast, BT7 1NN
United Kingdom

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

Blackrock, Co. Dublin
Ireland

Dariusz Wojcik

University of Oxford, St. Peter's College ( email )

New Inn Hall Street
Oxford, OX1 2DL
United Kingdom

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