Module: Sustainable Finance

Module Specifications.

Current Academic Year 2024 - 2025

All Module information is indicative, and this portal is an interim interface pending the full upgrade of Coursebuilder and subsequent integration to the new DCU Student Information System (DCU Key).

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Date posted: September 2024

Module Title	Sustainable Finance
Module Code	EF5181 (ITS) / FBA1028 (Banner)
Faculty	DCU Business School	School	DCU Business School
Module Co-ordinator	-
Module Teachers	-
NFQ level	9	Credit Rating	7.5
Pre-requisite	Not Available
Co-requisite	Not Available
Compatibles	Not Available
Incompatibles	Not Available

Coursework Only
The re-assessment will be in the form of a single individual assignment that covers all Learning objectives.

Description

The aim of this course is to impart knowledge and skills in Sustainable Finance and investing. The module aims to provide a working knowledge of appraising green investment products and identifying and measuring climate risk. Further, the student will be able to critically appraise the carbon market and emissions trading. The Module further introduces various regulations and frameworks that guide sustainable financing and investments. In addition, the modeling climate risk, ESG cashflows, and portfolio ESG scores will be discussed.

Learning Outcomes

1. Understand and discuss concepts of Sustainability, externalities and internalisation of externalities.
2. Critically Analyse the sustainability and ESG frameworks and regulations that impact corporate finance and investments
3. Appraise various green investment products, evaluate projects based on sustainable cashflows and apply principles of ESG portfolio theory to assess portfolio/asset risk and returns.
4. Identify and be able to evaluate climate risk and methodologies of measuring such risk
5. Discuss and critically evaluate the carbon pricing, emissions trading, and energy derivatives

*Type*	*Hours*	*Description*
Workload	Full-time hours per semester
Lecture	36	Seminar-style lecture classes
Independent Study	60	Reviewing material related to lectures, textbooks, and other reading material.
Directed learning	50	The Lecturer will provide information on various sources (like journal articles, reports, textbooks, URLs etc.. ) that are required by students to read/watch and learn from.
Independent Study	41.5	Preparing and studying various concepts; Working on Assignments and group project work
Total Workload: 187.5

All module information is indicative and subject to change. For further information,students are advised to refer to the University's Marks and Standards and Programme Specific Regulations at: http://www.dcu.ie/registry/examinations/index.shtml

Indicative Content and Learning Activities

Introduction
Sustainability, Externalities, Planetary boundaries, UN SDGs, Framework for Sustainable Finance, internalisation of externalities, ecological economics production function

Regulations, Frameworks, Ethical issues
Sustainable Finance Taxonomies – EU framework and other nation’s taxonomies, Social taxonomy, Market based taxonomies, TCFD, The CSR/ESG Disclosure Regulations, Climate/ESG risk reporting and regulations around the world, Principles of Responsible Investing, Green Washing

Sustainable Investments
Sustainable investing, Investment Strategies, Sustainable investment markets, Risk and Returns, Institutional investment process, Modeling sustainable project selection using sustainable net cash flows, Impact investing and socially responsible investing, ESG Portfolio, and ESG Efficient frontier, ESG Challenges and measuring scores.

Sustainable Financing
Principles of Sustainable Finance, Sustainable Products and Services - Green Bonds & Loans, Green Deposit schemes, Transition Finance, Project Finance, Forest Bonds, CAT Bonds, ESG-related Derivatives & Securitization, Weather derivatives, Debt-Nature Swaps, Sustainable Supply Chain Finance, ESG themed funds, ETF and index.

Climate Change Risk
Introduction to Climate Risk, Types of Climate Risk: Transition Risk, Physical Risks, Micro (Company-Level) and Macro Climate Risk: Systemic Risk and Financial Stability, Climate Risk Measurement methodologies, Climate risk transmission into Finance, the Economy, and Key Sectors. Risk Management, Climate Risk and Financial Supervision, Private-Sector Climate Frameworks.

Carbon Market
Net Zero, Carbon Finance and Carbon offsets, CDR CO2 Sequestering, Carbon/Emissions Trading [EU ETS], Carbon market participants, CDM, Power Purchase Agreements (PPAs), Renewable Energy Certificates (RECs) futures, Wind index futures, Renewable Identification numbers (RINs) futures and Low carbon fuel standard futures.

Assessment Breakdown
Continuous Assessment	100%	Examination Weight	0%

Type	Description	% of total	Assessment Date
Course Work Breakdown
Group project	Group presentation and Peer review	30%	n/a
Assignment	Individual Assignment	30%	n/a
Assignment	Evaluation / application-based assignment	40%	n/a

Reassessment Requirement Type
Resit arrangements are explained by the following categories: Resit category 1: A resit is available for both* components of the module. Resit category 2: No resit is available for a 100% continuous assessment module. Resit category 3: No resit is available for the continuous assessment component where there is a continuous assessment and examination element.
* ‘Both’ is used in the context of the module having a Continuous Assessment/Examination split; where the module is 100% continuous assessment, there will also be a resit of the assessment
This module is category 1

Indicative Reading List

Mirjam Staub-Bisang: 0, Sustainable Investing for Institutional Investors: Risks, Regulations and Strategies, Wiley, 978-1-118-203
Sonia Labatt, Rodney R. White: 0, Carbon Finance: The Financial Implications of Climate Change, Wiley, 978-1-118-161
Dirk Schoenmaker, Willem Schramade: 2019, Principles of Sustainable Finance, Oxford University Press, USA, 9780198826606
Harold Kent Baker, Hunter M. Holzhauer, John R. Nofsinger: 0, Sustainable Investing, 9780197643785
Richard Brealey, Stewart Myers, Franklin Allen, and Alex Edmans: 2023, Principles of Corporate Finance, 14, McGraw Hill, 9781264080946
Peter F. Christoffersen: 2012, Elements of Financial Risk Management, Academic Press, 0123744482

Other Resources

53186, Website pdf, CFA Institute with Swiss Sustainable Finance, 0, Handbook of Sustainable investment, https://www.cfainstitute.org/-/media/documents/book/rf-publication/2017/rf-v2017-n5-1.pdf, 53187, Website pdf, North American Task Force (NATF) of the United Nations Environment Programme Finance Initiative, 0, Green Financial Products and Services, https://www.unepfi.org/fileadmin/documents/greenprods_01.pdf,