Le 24 novembre 2020

Dans un contexte marqué par une remise en question de la finance en général et une demande pour une « finance autrement », comment appréhender le développement de nouvelles pratiques de financement de l’économie ?

Le 24 novembre à 14h, sur Teams.

"Finance for the Common Good : Thomistic Principles and Current Challenges"

Par Caroline MARIE-JEANNE, MCF en Sciences de Gestion

Abstract :

This article examines the links between finance and the common good. Firstly, our aim is to reflect upon this notion in the financial order by relying on fundamental writings. The study of the use of money according to the Thomistic approach, through loans and speculation, then provides food for thought to respond to future challenges. Saint Thomas emphasises the importance of sharing money and profit, of free loans, of the finality of the act and of the use value. Finally, we will show how these concepts can be developed today for a finance destined to the Common Good in the philosophical sense, thanks to participative finance, solidarity finance, microcredit, social bonds and green bonds.

"Sustainability Linked Loans: Star or Comet on the Debt Corporatee Market?"

Par Diana POP, MCF en Sciences Economiques

Abstract :

From 2017 a new banking product called “Sustainability Linked Loan” (SLL hereafter) has been allowing the companies to address the growing concerns about climate change and circular economy. SLL is a novel long-term focused financing option on the leveraged loan market, approaching the overall ESG related goals without tying the financial resources to any specific green project. Compared to the traditional bank debt, the SLL has a secondary pricing mechanism, with a floating margin dependent on an ESG benchmark. Thus, the credit interest is downward adjusted if the company performs better than the customized ESG target. To the opposite, when the target is missed, the bank requires a premium over the standard loan price Our central research questions is whether the availability of cash through revolving credit facilities and term debt having sustainability features has any peculiar contribution to the firm market valuation, both in normal economic conditions and during a collapse in demand. Such questions are addressed: (1) at the announcement of an SLL and; (2) at the announcement of lockdown and unlockdown decisions made in response to the overall pandemic exposure by China, Italy, France and the State of New York authorities, as well as in the case of major political decisions addressing the economic consequences of the pandemic crisis. In the first case, the company’s ability to borrow such funds could signal to the market its commitment to embed in the development strategy the UN goals, marking a bold move from the shareholder to stakeholder-oriented governance model. The market reaction in the second case shows how the investors perceive the effort of sustainability in the case of a major liquidity shock.