The Impact of Regulation on Sustainable Investment
Business, Management and Services
The aim of this project is to study the ability of mandatory sustainability regulations to generate structural changes in various characteristics of financial series, and in particular in return and volatility, which are the metrics most taken into account by investors. Regulations are also likely to bring about structural breaks in the impact of traditional factors such as activity and inflation on return and volatility. As the main asset classes, equities and bonds are the most exposed to these shocks. The project will look separately at developed countries, emerging countries, and Switzerland, to take account of the specificities of regulations and their impact on financial markets.
It will fill a gap in the literature on structural changes induced by sustainability regulations. The results could serve as a basis for the design of additional policies and regulations, particularly in Switzerland and in several emerging markets where sustainability regulation is still in its early stage. They could also provide investors with insights into the impact of regulation on different asset classes and in different regions.
This project is funded by the SNSF's Practice-to-Science programme.