Giulia Crippa
Education: Ph.D. ’26, Princeton University
Cornell Faculty Mentor: David Ng, Cornell SC Johnson College of Business / Dyson School
External Adviser: Julien Mazzacurati, European Securities and Markets Authority (ESMA)
Themes: Reducing Climate Risks
The Environmental Cost of Missing Information
Financial markets can reward low-carbon firms with a lower cost of capital, but only to the extent that investors observe emissions reliably, and high-emitting firms often withhold or selectively report carbon data. Because non-disclosure is systematically related to emissions, standard estimates understate the emissions of non-disclosing firms, misleading investors and regulators and distorting the pricing of climate risk.
Giulia’s project will quantify how these disclosure gaps distort capital allocation, integrating firm-level disclosure incentives with market-level asset pricing. The first component develops a structural model in which firms optimally decide whether to disclose emissions given regulatory, reputational, and measurement costs. The second embeds these mechanisms in an equilibrium asset-pricing model to trace how biased information affects expected returns and reallocates investment toward carbon-intensive sectors. Combining global carbon-reporting data with institutional portfolio holdings, she will estimate the magnitude of hidden financed emissions and evaluate whether mandatory disclosure reforms improve both information quality and capital allocation.