The ESG Initiative at the Wharton School

2022 Wharton Climate Prof event sets the tone for the school’s new ESG Initiative

Nine Wharton faculty members with expertise spanning from philosophy to accounting came together Wednesday, October 12 to share their research on climate and business to about 100 attendees at the Wharton Climate Prof event.

The showcase hosted by Wharton Climate Center Faculty Co-Directors Arthur van Benthem and Sarah Light covered cutting-edge research on topics including climate inequality, green investments, the legality of greenwashing, and more.

In a format inspired by Iron Chef and Wharton’s own Iron Prof events, each faculty member had just 5 minutes and “5ish slides” to present their research, shared van Benthem.

The event came at an opportune time. Hosted as a part of Penn’s Climate Week and as one of the center’s first events under its new home, the recently established ESG Initiative at the Wharton School, it drew a packed house of curious students, alumni, faculty, and staff.

Van Benthem explained that the Climate Center is, “the E [Environment] under the ESG umbrella at Wharton,” and shared his excitement that, “business, climate, and environment have made it to the list of top priorities for our school.”

Vice Dean and Faculty Director of the ESG Initiative Witold Henisz built on this enthusiasm, explaining that, “Wharton is really signaling its commitment to bringing ESG into the mainstream of business education and research by elevating the work around ESG to a school level priority – one of Dean James’ top two priorities going forward.”

For students like Neil Kapoor, an M&T junior pursuing a computer science degree at Penn Engineering and a finance concentration at the Wharton School, this event was the perfect opportunity to learn more about what Wharton is doing in ESG. “I came to see which faculty are doing research at the intersection of business and climate and to learn what academics can contribute to solving climate change.”

And as van Benthem explained, there is a rapid expansion of faculty doing research on these topics, “Not just because we keep hiring new good people, but also because existing faculty are starting to shift their agenda towards climate related issues.”

Neil tells me these faculty members brought a new perspective to finance topics he’s explored through his coursework and that this event has sparked his interest in taking classes that explore finance, tech, and climate.

Van Benthem explained that this “explosive growth in student interest in these courses” is made clear through the now 152 undergraduate and MBA students enrolled in the Business, Energy, and Environmental Sustainability (BEES) major.

Henisz added, “Starting next year Wharton undergraduates will be able to concentrate in ESG and Wharton MBAs will be able to major in ESG. We’re going to have a broader set of majors and we have over 30 elective courses [in this area].”

“We’re thrilled to see this leadership from the faculty, which is at the core of everything we’re doing. Without the research we can’t do the rest,” Henisz went on.

“We’re going to take that research, bring it into the classroom, and bring it into cocurricular experiences like the Wharton Impact Venture Associates (WIVA) program and the Wharton ESG Integration Projects (WEIP).”

“We want to provide new venues for you, not just to get education in the classroom, but to get out in the field and join the thousands of new jobs that are coming up in finance, consulting, and corporates in ESG,” Henisz closed.

Watch the faculty research showcase below.

Susanna Berkouwer, Assistant Professor of Business Economics and Public Policy, shared two research projects they’re working on in Kenya and Ghana that explore climate and inequality in the energy sector.

Brian Berkey, philosopher and Associate Professor of Legal Studies and Business Ethics, shared his research on the ethics of climate offsets, a practice that reduces or removes emissions of greenhouse gases to compensate for emissions made elsewhere.

Arthur van Benthem, Associate Professor of Business Economics and Public Policy and Faculty Co-Director of the Wharton Climate Center, shared his research on the effectiveness of two alternative vehicle air pollution policies in the US, leading him to investigate how the costs and benefits of such policies are distributed.

Francis X. Diebold, Professor of Economics, Finance, and Statistics, shared his research on the costs and benefits of an impending ice-free Arctic as the result of a feedback mechanism that worsens the warming effect of climate change to accelerate the melting of Arctic sea ice.

Luke Taylor, Professor of Finance, shared his research on how climate change is affecting the stock market, comparing and projecting the returns of green “environmentally friendly” stocks versus brown “environmentally unfriendly” stocks like coal.

Mirko Heinle, Associate Professor of Accounting, shared his research on how capital markets can lessen climate change through examining green investments, green efforts, and how incentives to do good can lead to the occurrence of greenwashing.

Dan Garrett, Assistant Professor of Finance, shared his research on climate and public finance, exploring why green municipal bonds remain rare in the US and showing how anti-ESG legislation in Texas drives down competition for municipal bond underwriting and will cost Texas taxpayers between $300-$500 million in extra interest.

R. Jisung Park, Assistant Professor of Business Economics and Public Policy and the School for Social Policy and Practice, shared his research at the intersection of climate change, human capital, and economic opportunity, identifying equity concerns in how heat worsens workplace safety and learning.

Sarah E Light, Associate Professor of Legal Studies and Business Ethics and Faculty Co-Director of the Wharton Climate Center, shared her forthcoming research arguing that false and misleading environmental marketing claims are not protected by the First Amendment, with important implications for attitudes toward regulation and consumer choices.