Halit Gonenc, Asad Rauf and co-author win AFS Best Paper Award

FEB Researchers Halit Gonenc and Asad Rauf, together with their co-author Gizem Ari, recently received the Best Paper Award at the 2026 African & Mediterranean Finance Society (AFS) Conference. They received the award for their paper titled ‘Carbon risk premium in multinational corporations’.

Halit Gonenc and Asad Rauf are associate professors at FEB’s Department of Economics, Econometrics and Finance (EEF). Their co-author Gizem Ari, who participated in a research visit to FEB, is an assistant professor at Hacettepe University (Ankara, Turkiye). Their paper examines carbon risk premia in US-based multinational enterprises (MNEs). Although emissions carry positive risk premia, MNEs face lower premia than domestic firms. The authors hypothesize that MNEs better mitigate climate transition risk through their international diversity.

Analyzing foreign subsidiaries, Gonenc, Rauf, and Ari find that premia are lower for more geographically diverse firms, and even lower for MNEs with more subsidiaries in countries with stricter environmental standards than the US. The effect is concentrated among MNEs that neither issue green bonds nor hold green patents, suggesting that international diversification substitutes for observable decarbonization signals. The authors’ study connects the international business literature on multinationals and climate change to the asset pricing of carbon risk.

Contribution to understanding carbon-related risks

The jury at the AFS conference regarded Gonenc, Rauf and Ari’s work highly. The jury report remarked: "Their insightful research on the Carbon Risk Premium in Multinational Corporations offers a significant contribution to understanding how carbon-related risks are priced in the global market, highlighting the financial implications for multinational enterprises operating under increasing environmental regulations and shifting investor preferences toward sustainability.”

The authors are deeply honored to receive the Best Paper Award. Gonenc: “This reflects the rigorous dedication of my co-authors and me to advancing the understanding of the Carbon Risk Premium within multinational enterprises. In this study, we aim to shed light on the complex challenges faced by multinational enterprises in managing and valuing carbon risk, given their diverse operational footprints and regulatory environments. This recognition motivates us to continue exploring the intersection of environmental risk and financial markets, contributing to the broader transition toward sustainable business practices and investment approaches that can support long-term economic and environmental resilience in the future.”

AFS awards

The African & Mediterranean Finance Society (AfriMed Finance Society or AFS) is an academic organization that aims to be a premier international forum for studying, communicating, encouraging, and celebrating the latest research in financial economics. AFS is particularly devoted to promoting knowledge and knowledge mobilization in Africa. AFS also aims to provide a mutual association of academics, practitioners, and doctoral students with an interest in researching relevant questions in the greater field of Finance to improve public understanding of financial economic problems. AFS annually recognizes outstanding scholarly contributions by conferring Best Paper Awards at its annual conferences.

Questions? Please contact Halit Gonenc