Criticality assessment of green materials: institutional quality, market concentration and recycling potential

The carbon transition and digitalization transformation are tied to a set of critical raw materials (CRM). Energy accumulators, renewable energy modules, and electronic devices all contain a certain amount of these. The versatility and utility of such elements come together with the limited number of countries where their extraction and refining take place. As the demand for these materials is growing globally, main concerns arise regarding the security of the production chain. Several works highlighted the risks associated with these materials without presenting clear interaction between such factors. This article presents a study over the three aspects showed: market concentration, institutional quality, and circularity. The approach will contain the presentation of the main characteristics of recyclability and the institutional status of exporters. A synthetic index is derived and plotted against the potential of recycling per material. In such a manner, we can group minerals according to sourcing vulnerability: one is coming from material recovery and the other via imports. An indicator calculated with a Cartesian distance method provides the synthesis of security versus safety. According to our findings, Electrical Vehicles carry the highest vulnerability for their main components in circularity and human rights violations. Ending remarks highlighted the limitations of our research, where possible interest for future research may lay

Financial markets implications of the energy transition : carbon content of energy use in listed companies

Published online: 22 January 2024Decarbonization is often misunderstood in financial studies. Furthermore, its implications for investment opportunities and growth are even less known. The study investigates the link between energy indicators and Tobin’s Quotient (TQ) in listed companies globally, finding that the carbon content of energy presents a negative yet modest effect on financial performance. Furthermore, we investigated the effect carbon prices in compliance markets have on TQ for exempted and non-exempt firms, finding that Energy efficiency measures yield greater effects in the latter group. Conversely, it is also true that carbon prices marginally reduce TQ more in non-exempt firms. This implies that auction mechanisms create burdens that companies are eager to relinquish by reducing emissions. However, reducing GHG yields positive effects on TQ only as long as it results in energy efficiency improvements

Transizione ecologica e dividendi ai confini opposti della finanza

All’alba della transizione ecologica, le imprese statunitensi devono scegliere tra il benessere degli azionisti oggi e quello del pianeta doman

Political cicles and Yardstick competition in the recycling of waste, evidence from Italian provinces

Recycling and the recovery of waste are crucial waste management strategies. In light of the new EU circular economy approach, these strategies remain core pillars of a competitive and sustainable waste value chain. Local governments have an important role in controlling and checking the implementation of waste management policies. We study the spatial determinants of waste recovery by using a dataset of 102 Italian provinces from the years 2001-2014. We exploit the political cycle of the provinces to isolate the effects of waste recovery in one province on neighboring provinces. We find that provinces mimic their own neighbors’ in the separate collection of waste aimed at recycling and recovery, with this effect being fully guided by provinces where the president can run for re-election (consistent with the yardstick competition hypothesis) but only when waste management policies become politically salient, that is, after the transposition of the 2008 EU Waste Framework Directive

'Carbon' boards and transition risk : explicit and implicit exposure implications for total stock returns and dividends payouts

Published online: 23 July 2024Transition risk disclosure facilitates investors' understanding of the potential company-level risks associated with a low-carbon transition. Among the others, stricter regulations could undermine companies' financial performances, affecting operations costs and revenues and their impact being proportional to the business carbon intensity. Transition risk disclosure takes two forms. One is a textual description of transition risk in compulsory and voluntary non-financial disclosure. The other is the disclosure of carbon emissions and intensity, which is implicitly associated with transition risk exposure. We empirically assess the impact of the two transition risk measures on shareholder returns to test the “carbon premium” hypothesis. We consider shareholder return as the sum of capital gain and dividend paid and analyse the impact of transition risk on both. Evidence supports the “carbon premium” hypothesis but suggests such a premium is transferred to shareholders primarily via dividend payouts. One possible explanation consistent with this evidence is that boards in highly polluting companies use dividends to compensate investors for the relatively lower capital gain, dissuading them from divesting due to low returns, stigmatisation effects and regulatory risks

Fiscal policies, public investments and wellbeing: mapping the evolution of the EU

The European Union faced several crises in the last twenty years that destabilized its macroeconomic equilibrium and development capacity. Standard economic methodologies were capable of neither predicting nor completely solving these crises through appropriate investments. To understand the overall development performance, the well-known Human Development Index (HDI) is the most widely deployed conceptual framework. In this article, we look at the components of welfare dynamics in the EU by examining socio-economic performance. Through a ‘beyond gross domestic product (GDP)’ approach, we analyse public expenditures, especially focusing on the pillars of growth and socio-economic development: education, health, and total R&D. We believe that convergence policies and sustainability policies should together be given a greater role within the EU agenda. They are necessarily interlinked with each other and with the common welfare, the true objective of public policy. European strategies on the key human development pillars were heterogeneous during the last decades. The post 2009 recession was characterized by non-expansionary measures that have undermined development in most countries. Due to the lack of a robust investment patterns towards human and sustainable development, European countries were not fully prepared to tackle the COVID-19 shock. Growth and development figures were already gloomy in 2019 and the years before. The hope is that this lesson is useful to create a solid society and economic system for possible future crises

Searching for a carbon laffer curve : estimates from the European Union Emissions Trading System

Published online: 15 March 2024Carbon prices have grown remarkably in the European Union (EU) Emissions Trading System (ETS) in recent years, raising distributional concerns. Revenues are expected to grow with higher carbon prices, thus providing resources to address distributional issues. Beyond a certain point, however, higher prices can discourage the purchase of allowances and ultimately reduce revenues, describing a Carbon Laffer Curve (CLC). We empirically investigate the CLC in the EU ETS between 2012 and 2021 using auction revenues at the country level. Results indicate that ETS revenues follow an inverted-U relationship in both the volume and the price of auctioned allowances, with an estimated optimal price between 86 and 125 euros

EU Emissions Trading System sectoral environmental and economic indicators

1 data file, 1 documentation filesThis dataset is composed of five indicators which provide information on the economic and environmental performance of sectors covered by the European Union’s Emissions Trading Scheme (EU ETS). The focus of the dataset is to have an overview of trends across sectors by tracking the evolution of the economic and environmental scope of the EU ETS. Doing so generates new insights into the coverage of the EU ETS, a key EU climate policy aimed at reducing Greenhouse Gas Emissions (GHG) cost-effectively. . The indicators were produced within the framework of the project LIFE COASE, co-financed by the EU LIFE Programme. The project aims to support EU and Member State policymakers in the implementation and development of the EU ETS. It aims at creating lasting cooperation between policymakers, academia and stakeholders and raising public awareness in the field of emissions trading.This dataset has been created in the context of the LIFE COASE, a project co-funded by the EU Life Programme of the European Commission.Sources of the data: European Union Transaction Log (EUTL), Emissions Database for Global Atmospheric Research (EDGAR), Orbis Database by Bureau Van Dijk, JRC-EU ETS-FIRMS, Joint Research Centr