We are excited to announce the publication of our new research paper written in the context of our Innossuisse project called ‘Investor and Stakeholder Tools for Tracking Companies’ Climate Commitments, Greenwashing and ESG Trends.’
This paper was written in collaboration with David Jaggi from the Department of Finance, University of Zurich, and Zurich University of Applied Sciences, Markus Leippold from the Department of Finance, University of Zurich, and Swiss Finance Institute and Tingyu Yu from the Department of Finance, University of Zurich.
This study presents ClimateControversyBERT, a novel open-source language model for real-time detection and classification of corporate climate controversies (i.e., brown projects, misinformation, ambiguous actions) from financial news. Validated using RepRisk and Refinitiv metrics, the model effectively identifies inconsistencies between corporate climate commitments and actions as they emerge. We document significant negative market reactions to these controversies: firms experience an immediate average stock price drop of 0.68%, with further declines over subsequent weeks. The impact is intensified by high media visibility and is notably stronger for firms with existing emission reduction commitments, underscoring the market’s penalty for perceived environmental failures.
Nicolas Jamet is Senior Fund Manager at RAM AI’s Systematic Equity team since 2016. He co-manages the systematic equity funds, working on the development of low-frequency systematic investment strategies. He is involved in enhancing AI infrastructure, incorporating sustainability into the fund range and contributes as a member of the Responsible Investment Committee.
