Corporate Finance: a Sustainability Perspective

Course Objective
This course aims to develop a framework that guides firms' investment and financial decisions, emphasizing sustainability considerations. This framework combines a solid understanding of the most common corporate finance theories with a sensible selection of the most suitable approach in practical situations.

LEARNING OUTCOMES

ACADEMIC AND RESEARCH SKILLS
After completing this course, the student can:
• identify international differences in regulation and corporate governance;
• understand which financial decisions create value;
• distinguish between relevant and irrelevant information for corporate financing decisions.
• understand how ethical, social, and environmental considerations influence the financial decisions of a firm in different international contexts.

BRIDGING THEORY AND PRACTICE
Knowledge: (Demonstrates theoretical and empirical knowledge concerning the relevant areas in international business administration). After successfully completing this course, the student will have a working knowledge of the following:
• relevant corporate governance mechanisms and international differences in CG;
• capital structure and financing decisions;
• agency conflicts within firms;
• corporate payout policies;
• the most common valuation methods (APV, WACC, FTE, and valuation multiples);
• relevant concepts on sustainability and corporate social responsibility in finance.
• quantify the value of a project/company taking financing decisions into account;
• compute expected changes in stock prices relating to these financing decisions.

Application (Ability to propose a solution to an international real-life business problem by applying relevant theories and methodologies). After completing this course, the student:
• understands the relevance of our financing theories in practice;
• understands the investment and financing decisions of firms discussed in financial media;
• appreciates the importance of financial models and the guidance they on how financial decisions are implemented in business by focusing on and simplifying the relevant aspects;
• can identify the role of corporate governance in helping firms and society to achieve sustainability and social responsibility goals.

BROADENING YOUR HORIZONS
After successfully completing this course, the student:
• can use a basic but comprehensive toolset to build valuation models for companies;
• understand how the institutional environment can shape the capital structure of firms operating in developed and emerging markets;
• understand the opportunities and challenges of sustainable finance in different institutional environments.

Course Content
This course discusses some of the firms' most important financing decisions. Throughout the course, we will examine different business environments and their implications on the firms' optimal capital structure, payout policies, and corporate valuation models. The course will allow students to understand better the behavior of markets of corporate securities in emerging and developed markets and the advancement of sustainable finance initiatives, departing from the historical, cultural, and regulatory environments across countries.

After successfully attending this course, the student will be able to:
• Discuss the implications of equity and debt financing;
• Critically assess assumptions and outcomes of most common valuation models;
• Understand how ethical, social, and environmental considerations influence the financial decisions of a firm in different international contexts

Teaching Methods
This course consists of a series of 10 lectures (up to 150 students per session) and four tutorials (up to 50 students per session), which will take place on campus. Each session has an expected duration of 1 hour
and 45 minutes. The expected contact time per week is 5 hours and 15 minutes (two lectures and one tutorial per week). Attendance to the tutorials is mandatory.

Typr of Assessment

• Written exam
• Practical assignment - group
• Participation assignment

Remarks
The themes taught in this course are prerequisites for the MSc Finance and strongly recommended for the MSc Financial Management.

Recommended background knowledge
Finance (E_IBA2_FIN)