Olimpia Carradori

Abstract: We study the determinants, structure, implementation, and effects of carbon underwriting policies among the world's largest insurers. Adoption is more common among European insurers and less so among specialty and unlisted firms, with coal policies emerging earlier than those targeting oil and gas. Implementation of coal policies is often incomplete, and some insurers expand coal coverage despite commitments. Using merged mine-insurance policy data, we show that insurers with coal policies reduce the number of insured mines by about 16%, insured coal volumes by 56%, and make continued coverage 13pp less likely. Affected mines reduce output, cut employment, and are abandoned more often in subsequent periods. 

Abstract: We show that climate transition risks can significantly disrupt supply chain networks. Specifically, suppliers affected by the California cap-and-trade program are more likely to lose customer relationships and less likely to form new ones compared to their competitors unaffected by the program. The effects are more pronounced among suppliers facing high competitive pressure and producing standardized inputs. Additionally, affected suppliers experience declines in revenues, assets, and profitability. This supply chain rewiring induced by uncoordinated climate policies is consistent with carbon leakage, as customers exposed to the program through production networks show an increase in their supply chain emission intensity.