The Evolving Academic Field of Climate Finance

The urgency and the magnitude of climate change will affect every aspect of our economies, societies, and planet. The academic finance research has begun to study the financial implications of global warming, although this body of literature is small. The literature exhibits distinct geographic tilts in terms of research preferences, draws young researchers, and much remains outside of the traditional finance domain. We explore, quantitatively and qualitatively, the emerging field of climate finance. We discuss its relevance for finance research and teaching and provide implications for financial economist and practitioners—in particular the need to incorporate this massive externality in valuation and risk analyses.