Climate Impact Investing – The Contribution of Sustainable Investments to Achieving Climate Targets (Climvest)
Duration: July 2022 – June 2025
Project Lead: Prof. Dr. Christian Klein - Chair of Sustainable Finance at the University of Kassel
Project Partners: Prof. Dr. Ottmar Edenhofer, Dr. Kai Lessmann - Potsdam Institute for Climate Impact Research (PIK); Prof. Dr. Marco Wilkens, PD Dr. Martin Rohleder - University of Augsburg; Prof. Dr. Andreas Ziegler, Dr. Gunnar Gutsche - Chair of Empirical Economic Research at the University of Kassel
Funding: Federal Ministry of Education and Research (BMBF)
Summary: Tackling the global climate crisis and the associated transformation process of the entire economic system is a major challenge. In this project, we analyze whether and how sustainable investments can contribute to achieving the goals of the Paris Agreement. From a practical and academic point of view, the specific question is which impact-related interactions on the capital markets can be used to achieve these goals. Using various methodological approaches, such as empirical studies, behavioral economic experiments and model theory, we will answer the question of whether a climate-friendly capital market already exists and to what extent differences in the willingness to pay for climate-friendly investments are crucial for a climate-friendly capital market. We will analyze how extensive these differences are and how they can influence corporate strategies through so-called "engagement activities" of shareholders. Finally, we will analyze how the environmental impact of climate-friendly forms of financing can be measured.
Duration: Juli 2020 – Juli 2024
Project Partners: Prof. Dr. Christian Klein - Chair of Sustainable Finance at the University of Kassel; Prof. Dr. Marco Wilkens - Chair of Finance and Banking at the University of Augsburg, Prof. Dr. Karsten Neuhoff - Climate Policy Department at the German Institute for Economic Research, Frankfurt School & Frankfurt School-UNEP Collaborating Centre for Climate and Sustainable Energy Finance, Research Group on Sustainable Finance - University of Hamburg
External Cooperation: Climate & Company
Funding: Stiftung Mercator
Summary: The Sustainable Finance Research Platform is a joint project between five German research institutions that is funded by Stiftung Mercator. With their independent research, the project partners aim to support stakeholders in politics, the financial sector, and the real economy in understanding and shaping the central role of capital markets in achieving a net-zero economy. The researchers involved answer social, political, and business-related questions, provide established and new research findings, and participate in political and public debate. They also want to establish sustainable finance as a topic in the German research landscape and secure connections with international institutes and processes.
Duration: February 2021 – January 2023
Project Partners: Evangelische Bank eG; EB – Sustainable Investment Management; Chair of Sustainable Finance at the University of Kassel; Chair of Management and Sustainability at the University of Hamburg
Summary: Various collaborative research efforts in the area of impact investing.
Duration: July 2020 – Dezember 2022
Project Lead: Prof. Dr. Timo Busch - Research Group on Sustainable Finance at the University of Hamburg
Project Partner: Prof. Dr. Christian Klein - Chair of Sustainable Finance at the University of Kassel
Funding Institution: Qualitätssicherungsgesellschaft Nachhaltiger Geldanlagen mbH (QNG)
Summary: The FNG-Label is the quality standard for sustainable investment funds in German-speaking countries. The holistic methodology of the FNG-Label is based on a minimum standard. In order to further differentiate itself from the market, the quality standard awards up to three stars to particularly high-quality sustainability funds that excel in the areas of "institutional credibility", "product standards" and "portfolio-focus". QNG is responsible for coordinating, awarding and marketing the label. The review process is also accompanied by an independent committee with interdisciplinary expertise.
Audits are conducted on behalf of QNG, a subsidiary of FNG, and in cooperation with the University of Hamburg to determine whether an investment fund can be described as sustainable. In addition, the methodology of the FNG seal is being further developed.
Duration: September 2020 – February 2022
Project Partner: German Savings Banks Association (DSGV); Chair of Sustainable Finance at the University of Kassel
Summary: This research project analyzes the impact of MiFID II and the implementation of the EU Action Plan's fourth provision "Consideration of sustainability in investment advice". The project aims to create a better understanding of the impact of the integration of the sustainability preference query as well as the potential barriers resulting from this regulatory intervention from an investment advisor's perspective. To answer the research question, semi-structured interviews were conducted with 30 investment advisors. This analysis was conducted using grounded theory according to Strauss and Corbin. The integration of the sustainability preference query, as well as the other actions taken early on by the Sparkassen-Finanzgruppe, have had the effect of reducing and in some cases overcoming many of the barriers that investment advisors previously perceived in the area of sustainable investments. However, the following barriers to investment advisors could still be identified: (1) lack of a uniform definition of the term "sustainable investment," (2) lack of a uniform label for sustainable investments, (3) perception of green-washing, (4) lack of impact reporting of sustainable investments, (5) risk aversion of German retail investors, (6) scope of possible sustainable products is insufficient and (7) perceived complexity of the future mandatory sustainability preference query.
Duration: December 2018 – November 2022
Project Lead: Dr. Kai Lessmann – Potsdam Institute for Climate Impact Research (PIK)
Project Partners: Prof. Dr. Christian Klein – Chair of Sustainable Finance at the University of Kassel; Prof. Dr. Andreas Ziegler - Chair of Empirical Economic Research at the University of Kassel
Funding institution: The Federal Ministry of Education and Research (BMBF)
Summary: Private sector finance will have a key role for the transition to a climate-neutral economy. It can provide finance for innovative, low or zero emissions alternatives in energy generation or energy efficient infrastructure, while managing the associated financial risks. But its success will depend on the available financial instruments. The IF project explores existing and novel instruments, their attractiveness for different groups of investors, and their potential within national climate policy.
The IF project investigates financial instruments for low-emission infrastructure designed to mobilize new investors. Institutional investors are of particular interest, as they arguably favor the risk-return profile of infrastructure projects but have as of yet largely ignored green infrastructure. And small institutional as well as individual investors currently have very limited access to low-emission infrastructure investment.
The project draws on a broad methodology to identify investment vehicles that can mobilize investment by these investor groups, exploring the spectrum of existing finance instruments as well as developing new instruments. Central questions are what makes low-emission infrastructure attractive as an investment for institutional investors and households, and how much private infrastructure investment can contribute to climate change mitigation.
Sustainably sourced mineral resources: a multi-stakeholder process for developing a certification system (NamiRo)
Duration: January 2015 – December 2017
Project Lead: Prof. Dr. Michael Hiete - Business Chemistry Department at the University of Ulm
Project Partners: Prof. Dr. Christian Klein – Chair of Sustainable Finance at the University of Kassel; Prof. Dr. Rüdiger Hahn – Chair of Sustainability Management at the University of Hohenheim; Prof. Dr. Stefan Seuring - Supply Chain Management Program at the University of Kassel; Dr. Gudrun Franken – Federal Institute for Geosciences and Natural Resources (BGR); Dr. Andreas Barth, Dr. Frank Schmidt und Enrico Kallmeier - Beak Consultants GmbH
Summary: NamiRo stands for sustainably produced mineral resources. The aim of the project is to develop a standard or certification scheme for mineral resources which is able to foster market transparency in mining and smelting of mineral resources. The target of this research project is the development of a system, e.g. for standard setting, diligence or certification, which documents and evaluates the extraction and processing of mineral resources in terms of their sustainability impacts transparently, along the various process steps in the value chain. Why is this relevant? Mineral resources and other commodities have in common that they are globally traded according to their material quality, though often in disregard of the circumstances of their production and processing. Mining and beneficiation are associated with numerous environmental aspects. Companies producing with high environmental and social standards have therefore a competitive disadvantage and their achievements are often not honored. This leads to market distortions, especially in case of internationally traded resources, hindering innovations in sustainability. Moreover, end-customers are requesting more and more often sustainably produced products, investors are in search of possibilities for sustainable investments and companies take responsibility for the whole supply chain of their products. Thus, customers at different positions of the supply chain start requesting information about the extent to which sustainability is assured during mineral exploitation and processing to fulfill their supply chainresponsibility. Different interests exist for fostering market transparency of mineral resources and for making environmental and social contributions visible. Up to now, such systems exist particularly for conflict minerals and high-value resources such as gold and diamonds. The acceptance, effectiveness as well as intended and unintended consequences (for example regarding social implications of such systems), are determined by a number of factors rooted in the general framework and the development process of the respective system.
Duration: July 2016 – December 2016
Project Lead: Prof. Dr. Ulf Hahne -Department of Economics of Urban and Regional Development at the University of Kassel
Project Partners: Prof. Dr. Christian Klein - Corporate Finance Department at the University of Kassel; Frankfurt am Main and Bologna, Modena Energy Agency; ASTER
Funding: Climate KIC
Summary: In CMF 2.0, the University of Kassel, the Modena Energy Agency (AESS), ASTER together with the Cities of Bologna and Frankfurt am Main aim to develop a fund structure that allows funding of income-generating and of non-income-generating projects, to substantially boost carbon mitigation and climate adaptation action. By tailoring the fund concepts to the local ecosystem, the project sets out for a powerful financial instrument with high and sustaining adoption within the local governance system.
Duration: October 2018 – September 2021
Project Lead: Prof. Dr. Rüdiger Hahn – Chair of Sustainability Management at the University of Düsseldorf
Project Partners: Prof. Dr. Christian Klein - Chair of Sustainable Finance at the University of Kassel; Prof. Dr. Frank Schiemann – Professor of Corporate Accounting at the Business Department at the University of Hamburg; Prof. Dr. Daniel Reimsbach - Department of Economics and Business Economics at the Radboud University; Claudia Tober – FNG e.V.; Matthias Kopp – WWF Germany
Funding: The Federal Ministry of Education and Research (BMBF)
Summary: The project will analyse the contribution and respective mechanisms of climate change reporting in reducing CO2 emissions through a mixed-methods approach. First, whether and how mandatory and voluntary climate change reporting is associated with changes in corporate CO2 emissions and with changes in investor reactions to disclosed climate data will be analysed. Building upon this analysis, the project investigates climate change reporting from the investor’s perspective. Subsequently, the project examines climate change reporting from the corporate point of view and analyzes the influence of different types of climate change reporting (e.g., mandatory versus voluntary reporting; reporting format; stand-alone reports versus integrated reports versus third-party reports; third party validation of climate change disclosure by auditors) on managerial decision-making. Results of all three working packages will be summarized in “policy briefs” providing recommendations for decision makers both in politics and society at large. The work of the Task Force on Climate-related Financial Disclosures (TCFD) and experiences in other countries will also be incorporated in the summary. Thus, the project will stimulate further developments in climate change reporting.