COMM 486E - Climate-Focused ESG Reporting and Analysis

This course will provide students with the background to understand the importance of ESG reporting to investors and other stakeholders. Environmental, Social and Governance factors will be considered, but the main focus is on climate. Topics covered will include the current and evolving climate regulation, reporting frameworks and standards, and best practices.  In addition to corporate reporting, the investor perspective will specifically be considered and topics such as ESG ratings, shareholder engagement, investment strategies and vehicles to facilitate the financing of climate mitigation, adaptation and transition plans will be covered. The course will also enable students to analyze information from corporate ESG disclosures and other sources to estimate the impact on corporate cash flows, cost of capital and in turn on corporate valuation. 

The course incorporates an experiential learning component where students work with a small business to calculate their carbon footprint. For more information see the UBC Sauder SME Climate Clinic.

Learning objectives:

Upon successful completion of this course, students will have the knowledge and skills to:

• Apply knowledge gained on carbon accounting and GHG emissions to a small business and understand climate disclosures of large corporations or organizations.
• Use their knowledge of current ESG disclosure frameworks, standards and best practices to evaluate corporate ESG disclosures.
• Determine what the material reporting issues are for different industries and corporations and evaluate the maturity of a corporation based on the level of ESG integration in their business.
• Differentiate between the main reporting frameworks and describe the TCFD framework and its four main thematic focus areas and how disclosure along these themes can benefit corporations.
• Describe the basic science behind the need to achieve net zero by 2050 and the relative importance of certain industries in this goal, with a specific focus on the role of financial institutions in financing transition plans.
• Differentiate between the main ESG ratings and describe how methodologies used differ and can result in a disparity in ratings.
• Apply fundamental ESG analysis to valuation and determine how to adjust a valuation model for climate and other ESG factors.
• Describe the financing vehicles available to uniquely address climate issues and finance transition.
• Differentiate impact investing from other ESG investment approaches and describe the strategies that can be used to hold corporations accountable to achieve targets and to execute transition plans.

Prerequisite: Third-year standing or above.