Quantitative Sustainable Economics and Finance 
Time: 11.00 am
Date:16th of October 2025
Room 3001

Fanny CARTELLIER (University of Zurich ) “From nature loss to stock returns: an asset pricing modeling framework”

Abstract : Nature loss, in the form of degradation of biodiversity, ecosystem services, water quality and availability, as well as soil acidification, represents a significant threat to global economies, with profound implications for the financial system. Conversely, understanding and integrating nature’s value into investment strategies is crucial for the transition towards a sustainable economy. Despite increasing empirical evidence linking biodiversity loss to stock returns, a comprehensive conceptual framework that outlines the transmission channels of nature loss to asset pricing remains unexplored. This paper aims to address this gap by exploring how nature loss affects company valuations and stock returns through its dependence and impact on ecosystem services. Drawing on production-based asset pricing,  we develop a flexible modeling framework, accounting for companies’ dependence and impact on nature, as well as investors’ and consumers’ preferences for nature quality. This flexible framework allows us to raise fundamental questions on the channels from nature to asset pricing, and on the way nature risks can be priced in stock returns.

Organizers:  Patricia Crifo, Emmanuel Gobet, Peter Tankov, Gauthier Vermandel, and Olivier David Zerbib

Sponsors:
CREST-CMAP