VP Bank honours the best academic paper on sustainable finance
This year's prize went to Filippo Pellegrino from Imperial College London for his paper, 'A Tale of Commodities and Climate-Driven Disasters'. The study impressively demonstrates the impact of climate risks on commodity prices, a field that has received limited research attention to date.
Research with practical relevance
Pellegrino combines data on extreme weather events, such as floods, droughts and storms, with cutting-edge econometric methods. His empirical findings demonstrate that climate risks are not merely hypothetical scenarios, but have tangible and quantifiable consequences for the economy and financial markets.
The most important findings are:
- Climate-related disasters significantly impact commodity prices and market volatility.
- Commodities whose production is concentrated in one region are particularly vulnerable.
- In addition to short-term price shocks, observable risk premiums are evident in the long term.
- These effects are of central importance for investors and policymakers.
The jury praised the innovative methodology
The jury particularly highlighted the precise combination of geospatial production data with innovative analytical methods. This work sets new standards for empirical research and opens up a field that has been barely explored to date: the systematic investigation of climate risks in commodity markets.
‘Filippo Pellegrino's work provides valuable insights for investors, banks, and policymakers who must address the challenges of climate change,’ says Bernd Hartmann, Head of the CIO Office at VP Bank.
About the Best Paper Award
VP Bank presents the 'Best Paper Award' to promote academic excellence and create a platform for exchange between research and financial practice. Since 2017, the award has been presented as part of the 'Liechtenstein Workshop of Sustainable Finance'. The aim is to raise the profile of innovative research on sustainable finance and demonstrate its importance to the financial sector.
