George Skiadopoulos, Professor of Finance in the School of Economics and Finance at Queen Mary University of London interviewed.
I am interested in the intersection of academic research in Finance with industry needs. I envisage academic research as a tool for providing solutions to practical problems of interest to firms, investors and policy makers. I am teaching the Quantitative Methods for Finance II at the Goldman Sachs Apprenticeship Program
Currently, I am deeply interested in climate finance and in topics in ESG (Environmental-Social-Governance). For instance, with my colleagues and Ph.D. students we are working on topics such as measuring climate change risks and whether these are reflected in stock prices, if divestment affects firms’ cost of equity and other real effects it may have, on whether stock portfolios formed on ESG information outperform, and on measuring social risks. We use a wide range of research tools to conduct our research, including state of the art techniques on textual analysis and asset pricing and econometric tools. Many of these would not be feasible without the access to large and special databases that the School of Economics and Finance possesses.
The implications differ depending on the research question. Indicatively, we find that stock portfolios do not outperform (i.e. they do not provide a positive alpha) once formed on material ESG information. This overturns the narrative used by a grand ecosystem of institutional investors, ESG data vendors and sustainable reporting organizations. Our findings call for caution when marketing financial products as sustainable and are of paramount importance to policymakers and regulators who need to adopt stricter rules to avoid greenwashing.
I would like to continue working in the ESG field as this is a hot topic of importance to the broader society, thus offering the opportunity for making an impact to people’s lives.
There are plenty of modules, including sustainable investing, econometrics, and machine learning techniques. SEF has introduced new programs on timely topics of interest to professionals and policy makers and offers a unique opportunity to students to get educated on cutting edge academic developments and apply them to practical problems.