Gianfranco Gianfrate research “highly commended” in the 2024 FT academic research awards

• This article has been initially published on climateimpact.edhec.edu

About the FT Responsible Business Education Awards

The FT Responsible Business Education Awards were created in 2021 to go beyond the business school rankings, to “ensure a wider variety of activities are analysed qualitatively to showcase, reward and incentivise individual examples of best practices”, says the Financial Times. The research awards distinguish publications addressing societal challenges whose associated outreach/engagement has delivered positive impact on policy or practice.

The following three categories highlighted for 2024 are:

• Best business school teaching cases, pedagogical resources and modules or courses produced in the last three years on sustainability or climate change adaptation — with a special focus on teaching sustainability in finance.
• Best business school academic research addressing societal challenges with associated outreach/engagement in the last three years which has delivered positive impact on policy or practice.
• Best business school demonstrating system-wide responsible business principles integrated throughout teaching, research, operations and student outcomes.

This year’s winners looked at improving reporting of domestic violence or creating cooperation between child abuse activists and the police; at measuring the costs for US municipalities of anti-ESG actions imposed by State-legislators; have applied large language model (LLM) to measure the gap between climate finance pledges and actions or to document that the “life below water” UN Sustainable Development Goal was a blind-spot in terms of adverse impacts by companies.

• View the official announcement of all award winners here: Academic research award: problem solvers for the planet (2024)

About the Highly Commended publication by Gianfranco Gianfrate on Internal Carbon Pricing (ICP)

Companies are increasingly called upon to collaborate in the fight against climate change in the context of emerging global climate governance and rising public awareness for the need to accelerate decarbonisation.

Corporate involvement in climate mitigation is crucial as over two thirds of global emissions since the start of the industrial revolution are attributed to companies and pledges by national governments in the wake of the Paris Agreement cannot be delivered without material changes in the activities of major sources of emissions such as companies.  For the same reason, corporates are particularly exposed to the risk that government at different levels will impose policies and regulations aimed at reducing emissions.

New tools are emerging to assist with the delivery of corporate greenhouse gas (GHG) emissions reduction objectives, with internal carbon pricing (ICP) becoming a widespread practice globally. ICP is a voluntary method for companies to internalise the social cost of their GHG emissions, even when all or part of their operations are out of the scope of external carbon regulations.

Gianfranco Gianfrate, EDHEC Professor and EDHEC-Risk Climate Impact Institute Research Director, has pioneered academic research into the application of internal carbon pricing by corporations and promoted its real-world uptake through contributions to trade magazine and business and management publications such as Harvard Business Review, presentations, and engagement with standard setters and other influential bodies.

His latest contribution (co-authored with Nuno Beto, IUL Professor) explores the factors that explain the adoption of internal carbon prices among global companies. Results show that the prices depend on the national climate policy, home country's development, industry, and corporate governance. However, national context has higher explanatory power than industry and firm-specific characteristics indicating that climate policy uncertainty hampers carbon pricing by businesses. Firm-level internal carbon prices are significantly higher in countries explicitly pricing carbon through tax and/or cap-and-trade programs.

These findings shed light on how companies are factoring climate change in their decision-making and on the drivers that can contribute to the generalisation of climate pricing in the global economy.

• Read "Six questions on Internal Carbon Pricing" by EDHEC Risk Climate.

About Gianfranco Gianfrate

Gianfranco Gianfrate is Professor of Finance at EDHEC Business School and Research Director at EDHEC-Risk Climate Impact Institute. He writes and researches on topics related to innovation financing, corporate valuation, and climate change finance. Prior to joining EDHEC Business School, he held teaching and research positions at University of Cambridge (UK), Erasmus University (Netherlands), Harvard University (USA), and Bocconi University (Italy).

Gianfranco also has extensive experience in the financial industry, having worked, among others, for Deloitte Corporate Finance (Italy), Hermes Investment Management (UK), and iStarter (UK). Gianfranco holds a BA and a PhD in Business Administration from Bocconi University and a Master in Public Administration from Harvard University.