Exploring environmental, social, and governance disclosure effects on the S&P 500 financial performance
By Marcel C. Minutolo, Werner D. Kristjanpoller, John Stakeley. Business Strategy and the Environment, 2019
198 citations recorded by the source corpus.
Much of the literature measuring the relationship between environmental, social, and governance (ESG) scores and firm performance treats the score as a measure of sustainability performance. In this study, we treat a firm's ESG score as a demonstration of strategic choice in the level of transparency that results in increased firm performance as measured by Tobin's Q and return on assets. Performance differences are a result of choice moderated by the size of the firm as measured by employees and sales. We analyze 467 firms in the S&P 500 from 2009 to 2015. Applying legitimacy and stakeholder theory, we find that there is significant difference between groups with respect to disclosure and performance. The results of quartile analysis by sales, capitalization, and Tobin's Q are relevant to understand the influence that the ESG score has on financial performance. ESG influences onTobin's Q are greatest for large firms as measured by sales, as opposed to the ESG affects onTobin's Q and return on asset for smallest firms as measured by market capitalization.
Subfields: Marketing, Strategy and Management
View Paper: https://www.semanticscholar.org/paper/95011e71744f950664d00beab371cd2baed7718b
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Citations in the corpus
- The Interaction Effect between ESG and Green Innovation and Its Impact on Firm Value from the Perspective of Information Disclosure (2020, background): “In order to show the endeavors that they make for undertaking social responsibilities to all walks of life, the enterprises of various countries disclose CSR information in environment, society and governance, and improve the transparency of CSR information disclosure [10].”