Smith professor wins Bank of Canada award

Kingston, Ont. – Smith School of Business associate professor Ryan Riordan is being given this year’s Bank of Canada Governor’s Award.

The Governor’s Award is a research grant that goes to academics who study areas that the Bank of Canada deems important. The grant is worth up to $30,000 a year over two years.

Riordan, who is also Distinguished Professor of Finance at Smith, said he is delighted to receive the award. While central banks tend to focus on the economy as a whole, his studies delve into the behaviour of individual traders, investors, lenders, borrowers and firms. “So this award is a confirmation that our research is important to the overall economy,” he said.

Riordan intends to use the grant to further his research in two areas: the use and misuse of technologies in banking and financial markets; and climate change.

On climate change, Riordan has teamed up with colleagues from the University of Augsburg in Germany to study how financial markets have responded to the transition to a green economy. They’ve developed a methodology to measure the carbon risk of companies and countries. 

Among their findings to date: the valuation of banks and other financial firms are strongly related to the carbon risk of the firms they finance. And European countries such as Italy, Spain and Portugal, as well as Japan, have lower carbon risk than most countries. Canada, South Africa and Brazil have the highest carbon risk.

The Governor’s Award is part of the Bank of Canada’s Fellowship Program. Lawrence Schembri, deputy governor at the bank, says the program aims to “foster collaboration between our researchers and outstanding academics who are advancing knowledge in fields that support the Bank of Canada’s core functions.”

Riordan joined the faculty at Smith in 2014. His research into technology’s impact on financial markets has included how high-frequency traders improve stock market efficiency and studying how automated bidders affect the behaviour of human bidders on electronic financial markets and online auctions such as eBay 

In November, Riordan received Smith’s Research Excellence Award. The annual prize recognizes outstanding research by faculty at the school.