China Accounting and Finance Review 2021 Virtual Annual Conference

Prof. Christian Leuz, University of Chicago Booth School of Business

Speech title: Mandatory ESG/Sustainability Reporting - Current Landscape and Potential Economic Effects

Abstract:
The speech is based on a recent RAST paper entitled “Mandatory CSR and Sustainability Reporting: Economic Analysis and Literature Review”, coauthored by Hans Christensen, Luzi Hail and Christian Leuz. It collates potential economic consequences from a mandate and what the literature has to say about them. Prof. Leuz will first describe the sustainability reporting landscape and the recent push for mandatory sustainability or ESG reporting. Then he will discuss the reasons behind such push and the different goals that those pushing for a mandate might have in mind. Finally, he will discuss some of the lessons from academic research for a mandatory sustainability reporting regime, and highlight potential areas for future research.

Speaker’s bio:
Christian Leuz is the Joseph Sondheimer Professor of International Economics, Finance and Accounting at the University of Chicago's Booth School of Business. He is a Research Associate at the National Bureau of Economic Research, and a Fellow at the at the European Corporate Governance Institute, Wharton's Financial Institution Center, Goethe Universität Frankfurt's Center for Financial Studies, the CESifo Research Network and a member of the IGM's European Economic Experts Panel. He studies the role of disclosure and transparency in capital markets and other settings, the effects of regulation, international accounting as well as corporate governance and corporate financing decisions. His work has been published in top accounting and finance journals. He has received several awards and honors, including the 2016 and the 2014 Distinguished Contribution to the Accounting Literature Awards, the Humboldt Research Award in 2012, as well as the 2011 Wildman Medal Award. He was also recognized as a "Highly Cited Researcher" by Thomson Reuters and included in their list of "The World's Most Influential Scientific Minds" in 2014-2018. Professor Leuz is an editor for the Journal of Accounting Research and has served on many editorial boards, including the Journal of Accounting and Economics, The Accounting Review, the Journal of Business, Finance and Accounting, and the Review of Accounting Studies.

Born in Germany, Professor Leuz earned his doctoral degree and Habilitation at the Goethe University Frankfurt in Germany. Prior to this position, he was the Harold Stott Term Assistant Professor in Accounting at the Wharton School of the University of Pennsylvania and a visiting doctoral fellow at the Simon School of Business, University of Rochester.

Speech title: Accounting and Finance in the Age of Climate Change

Abstract:
Asset managers are increasingly required to disclose the carbon emissions of their holdings as well as climate VaRs relating their firms' exposures to extreme weather. They are also being pressured to implement sustainable-finance mandates to screen out firms that do not meet net-zero emissions targets or at least factor in their climate risks. Firms are at the same time announcing carbon-emissions reduction plans. In this keynote, I assess the welfare consequences of these developments. I make the case that net-zero emissions mandates are an implicit “sustainable-finance” tax on shareholders that can help address the global-warming externality by incentivizing firms to invest in decarbonization capital. But even as my calculations suggest that welfare-maximizing mandates can fund 25% of the reduction in aggregate emissions by the Paris Agreement deadline of 2050, emissions control cannot address the extreme weather consequences of global warming for many decades. I offer theoretically-motivated metrics for investors and firms to manage extreme-weather risks in the interim.

Speaker’s bio:
Harrison Hong is the John R. Eckel Jr. Professor of Financial Economics at the Columbia University Department of Economics. Before coming to Columbia in 2016, he was on the economics faculty of Princeton University, most recently as the John Scully ’66 Professor of Economics and Finance. Prior to that, he was an associate professor of finance at the Stanford Graduate School of Business from 1997-2001. He received his B.A. in economics and statistics with highest distinction from the University of California at Berkeley in 1992 and his Ph.D. in economics from M.I.T. in 1997. In 2009, he was awarded the Fischer Black Prize, given once every two years to the best American finance economist under the age of 40. He received honorary doctorates from Stockholm School of Economics and Aalto University and was a past Director of the American Finance Association. He is a research associate at the National Bureau of Economic Research and an academic advisor at LSV Asset Management. He has contributed to a number of areas in financial economics, including stock market efficiency and behavioral finance. His recent work focuses on the role of the financial system in addressing climate change. He is an author on the upcoming Fifth National Climate Assessment.

Ms. Sammie Leung, PwC

Panelist's bio:
Sammie Leung is a Partner of One Firm Services in PwC Mainland China and Hong Kong. She has long been engaged in ESG and climate change related issues. With a team of 100+ Environmental, Social and Governance (ESG) professionals, the nationwide practice offers four key services: ESG Reporting, Green Finance, Climate and Strategy & Transformation.

For corporates, Sammie’s team serve 80+ companies in ESG disclosure advisory work, including reporting in accordance with major reporting frameworks such as Global Reporting Initiatives (GRI), Sustainability Accounting Standards Board (SASB) and Hong Kong Stock Exchange ESG guidelines .

Sammie also helps corporate clients start or enhance compliance with recommendations of Taskforce on Climate-related Financial Disclosures (TCFD) by advising on identification of climate-related risks, performing science-based scenario analysis, measuring and disclosing corresponding financial impacts. She also assists clients in science-based target setting, decarbonisation strategy design and implementation as well as United Nation Sustainable Development Goals (UNSDGs) adoption.

For asset managers and owners, Sammie led the SFC survey on integrating Environmental, Social and Governance Factors and Climate Risks in Asset Management in 2019. Her project experience also covers ESG integration framework design, ESG strategy, climate-related risk integration and assessment for different types of investment houses.

Sammie serves multiple roles in professional associations on ESG related matters, including the Hong Kong Green Finance Association (HKGFA) and the Hong Kong Institute of Certified Public Accountants (HKICPA). She has been serving as a member of the External Audit Committee of a tertiary education entity in Hong Kong for over seven years.

Sammie is a member of the Academy of Finance (AoF), the Hong Kong Institute of Certified Accountants (HKICPA) and the Association of Chartered Certified Accountants (ACCA).

Ms. Judy Li, Ernst & Young

Panelist's bio:
Judy Li is the leader of Sustainability of Financial Services in Asia Pacific and the Partner of Climate Change and Sustainability Services (CCaSS) of Financial Services in Ernst & Young Greater China. She leads and drives sustainable finance across the region, working closely with each country and market in the region. She represents the region on a global level as she collaborates with the Global Sustainable Finance team to strategically develop, drive and implement policies and programs to help EY and the FSO become a leader in sustainable business solutions and operations.

In Greater China, Judy li leads the team to work on decarbonization, climate change mitigation and adaptation, green finance and sustainable development which include roadmap and strategic plan of carbon neutral target, advisory of energy savings and green operations, assurance of carbon neutrality, green bond/social bond/blue bond/transition bond sustainability-linked bond issuance assurance, green loan/sustainability linked loan assurance, EY Green Finance Management System, strategy and execution of green fund/ESG investment, ESG reporting and disclosure, EY ESG performance Analysis Model, strategy and execution of Equator banks, environment and social risk management and environmental / climate related risks stress testing etc. She is the focal point of information disclosure task force under Green Investment Principles of Belt and Road Initiatives, leading expert of establishment for UN Sustainable Finance Standard and etc.

Ms. Li has been performing as technical expert to participate in national policy and provincial regulation establishment of green finance sustainable development as well as related international and bilateral standard. She has been nominates as Special Researcher of Top 50 of China Carbon Neutrality Forum and has also been entitled with the Expert of Green Securities Committee of China Securities Regulation Commission, the Member of Green Finance Professional Committee of China Green Finance Committee, the Expert committee member of Climate Investment and Financing Committee of Department of Climate Change of Ministry of Ecology and Environment, the Committee member of ICMA Global Advisory Committee of Green Bonds, Social Bonds and Sustainable Development Bonds, the Member of Beijing Green Finance Committee, the Executive Director of Shanghai LuKiaZui Green Finance Development Center, the Expert of Green Finance Reform and Innovation Committee of Huzhou Zhejiang the Special Consultant of Sustainable Finance of UMDP, the Global Thinktank Expert of Sino Research Institute of Green Finance, the Industry Mentor of Shanghai JiaoTong University, and the Guest Fellow of Green Finance and Sustainable Development Center of University of International Business and Economics, the green finance lecturer of Fanhai International School of Finance, Fudan University etc. Ms. Li is now leading EY CCaSS team to work with HKMA/HKIMR no HK Green Bond Market survey and to support green and sustainable finance development in HK.

Before joining EY, Ms. Li worked in New York headquarter and China country office of the United Nations Development Programme (UNDP). She has deeply engaged with various sustainability-related work, such as global energy and environment programme, multilateral negotiation of climate change mitigation and adaptation, climate finance project, and execution of Montreal Protocol.

C.S. Agnes Cheng, The Hong Kong Polytechnic University

Albert Tsang, The Hong Kong Polytechnic University

Ji-Chai Lin, The Hong Kong Polytechnic University

Qiang Wu, The Hong Kong Polytechnic University

Nianhang Xu, Renmin University of China

Huacheng Wang, Renmin University of China 

Chitru S. Fernando, University of Oklahoma

Cheng Zeng, The Hong Kong Polytechnic University

Hangsoo Kyung, The Hong Kong Polytechnic University

Chi Man Yip, The Hong Kong Polytechnic University

Chengzhu Lisa Sun, The Hong Kong Polytechnic University

Zhihong Yi, Renmin University of China

Fuxiu Jiang, Renmin University of China

Lingling Zheng, Renmin University of China

Xiaodan Gao, Renmin University of China

Daxuan Zhao. Renmin University of China