Essays in Supply Chains and Sustainable Finance
DThe interactions between supply chains and sustainable finance have become a key area of research in financial markets, driven by growing global awareness of environmental and social challenges. Article 1 examines how lenders use sustainability clauses to monitor borrowers with negative environmental incidents and compares the use of this unique loan agreement design with conventional loan terms, financial and balance sheet-related clauses. We show that lenders are less inclined to include sustainability clauses in the loan agreement if a borrower has a history of negative environmental incidents. In contrast, lenders use sustainability clauses to attract institutional investors to participate in syndication rather than as monitoring tools for borrowers' environmental performance. Article 2 examines whether banks associated with biodiversity loss in the Amazon region experience a withdrawal of deposits when depositors become aware of their financing activities. I find empirical evidence that so-called ‘Amazon carbon banks’ experience slower growth in deposits once depositors learn about their financing activities. This effect is particularly pronounced when Amazon carbon banks have branches in counties that experience greater biodiversity loss compared to other branches. Article 3, how European companies that are heavily integrated into global supply chains (GSC) are affected by a supply chain disruption (Covid-19). We show that Covid-19 negatively affects the revenue growth of companies that are heavily dependent on GSC in their home country. Crucially, we uncover the role of banking relationships in mitigating the disruptive effects.
