ESG in Global Corporate Bonds: <i>The Analysis Behind the Hype</i>

Bahra, Bhupinder; Thukral, Lovjit

doi:10.3905/jpm.2020.1.171

Cited by 20 publications

(7 citation statements)

References 9 publications

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“…With the deepening of research, studies have begun to pay more attention to the internal mechanism of the information effect of ESG ratings on bond investors. In this case, Bahra and Thukral (2020) concluded that ESG scores could improve portfolio outcomes by reducing extraction rates and portfolio volatility and even slightly increasing risk-adjusted returns in some cases; According to Jang et al (2020), ESG scores were found to contain valuable information about a corporate downside risk. This effect is particularly pronounced for corporations with highly asymmetric information, such as small corporations; more recently, Kanamura (2021) argues that the value of ESG nancing lies in the reduction of risk and the elasticity of expected returns.…”

Section: The Information Effect Of Esg Ratings On Capital Marketmentioning

confidence: 97%

ESG ratings, monetary policy uncertainty, and bond issuance premium

Zhang

Gao

Wang

et al. 2022

Environ Sci Pollut Res

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Existing studies generally recognize the critical role played by macro monetary policy, of which the uncertainty will increase corporate bond issuance premiums at a micro level. However, relatively little is known about these relationships from the perspective of non-nancial information in corporation. So this study set out to do further exploration. We use the database to obtain information, including the bond issuance of A-share listed corporations in China during 2015 to 2020. The ndings suggest that high environmental, social, and governance (ESG) ratings from listed corporations signi cantly weaken the positive correlation between monetary policy uncertainty and bond issuance premiums. Speci cally, it has a positive information pricing effect on China's primary debt issuance market, as well as a mitigating impact on macro nancial policy risk. We also nd, through further mechanistic studies, that ESG ratings are more helpful in undermining the impact of monetary policy uncertainty on bond issuance premiums in the context of higher nancial information quality. Our ndings are conducive to enriching the research framework of the economic consequences of ESG ratings, meaningfully in uencing the growing literature that exposed the mechanism of bond issuance premiums, and further, verifying the interaction of information at different levels (macro vs micro) in asset pricing.

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Section: The Information Effect Of Esg Ratings On Capital Marketmentioning

confidence: 97%

ESG ratings, monetary policy uncertainty, and bond issuance premium

Zhang

Gao

Wang

et al. 2022

Environ Sci Pollut Res

View full text Add to dashboard Cite

show abstract

“…A non-linear relation between the ESG policy adoption and the innovation capacity of firms was established for Japanese firms; ESG adoption improves the firm’s ability to pursue innovative practices in the beginning and later affects financial and operational performance positively (Broadstock et al ., 2021). ESG scores reduce the portfolio’s volatility and improve portfolio outcomes (Bahra and Thukral, 2020).…”

Section: Mapping the Trends In Esg Research In The Last Five Years (2...mentioning

confidence: 99%

Mapping the environmental, social and governance literature: a bibliometric and content analysis

Jain

Tripathi

2023

JSMA

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PurposeThis study aimed to quantify and map academic literature of ESG from a bibliometric perspective and to provide a comprehensive review of the recent literature published in the high-rated journal articles.Design/methodology/approachThe study analyzed 867 and 388 documents from Scopus and Web of Science (WoS) data respectively using bibliometric analysis. Biblioshiny and VOSviewer software was used for performance analysis and science mapping respectively. Further, manual content analysis of the 190 research articles published in the last five years was conducted.FindingsThe results demonstrate that ESG is an emerging domain in the field of sustainable finance as the number of publications and total citations are showing an upward trend. The top two journals in terms of productivity are the Journal of Sustainable Finance and Investment and Business Strategy and the Environment. The highest number of publications are from the United States and George Serafeim is the most influential author in the ESG domain. Further, the result of cluster analysis of bibliographic coupling reveals four intellectual themes, (1) ESG investing; (2) ESG disclosures and Integrated Reporting; (3) ESG performance and firm value and (4) Corporate Governance and ESG performance. The content analysis of the 190 high-quality journal articles presents the current 11 areas of research in ESG. The impact of ESG on firm value and ESG investment are the prominent themes, and the effect of ESG on the cost of capital and ESG audit and assurance are the emerging themes in this domain.Research limitations/implicationsThe keyword search is solely focusing on the theme of the study. Further, other keywords such as Corporate Social Responsibility and Corporate sustainability taken along with ESG may provide distinct results.Practical implicationsThe study advances the understanding of the ESG domain by developing new possibilities to discover key research areas.Originality/valueThe present work provides a comprehensive and detailed bibliometric and content analysis of ESG literature. This study delineates the thorough literature review of journal articles published in the recent five years in high-rated journals.

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“…In other settings, ESG ratings also show to have effects on the bond uncertainty. For example, Bahra and Thukral [36] find that ESG information can be used to improve portfolio characteristics such as lowering drawdowns, reducing volatility, and increasing risk-adjusted returns, even though the increase is marginal. Mendiratta et al [37] find similar results regarding the relationship between ESG information and bond uncertainty.…”

Section: Esg Investing and Its Implications: Fixed-income Marketsmentioning

confidence: 99%

Perspective Chapter: The Environmental, Social, and Governance (ESG) Investment and Its Implications

Sarajoti¹,

Chatjuthamard²,

Papangkorn³

et al. 2023

Business, Management and Economics

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Investment management has been an important part in a long-term financial planning for investors around the world. Traditionally, investors aim to maximize the risk premium relative to the riskiness of the investment subjected to certain goals and constraints such as the time horizon, risk appetite, and consumption behavior. Recently, investors, both retail and institutional investors, have shown significant interests in sustainability especially on the environmental, social, and governance, which is often referred to as ESG investments. Studies on ESG investing are unable to reach consensus. We will review literature related to ESG investing in order to identify key limitations that obstruct advancements in this field. In particular, key limitations that we have identified involve the issues of data inconsistencies and the choice of benchmarks, among others. Furthermore, this chapter identifies areas for future research that address these limitations and thus should advance research in this field.

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ESG in Global Corporate Bonds: The Analysis Behind the Hype

Cited by 20 publications

References 9 publications

ESG ratings, monetary policy uncertainty, and bond issuance premium

ESG ratings, monetary policy uncertainty, and bond issuance premium

Mapping the environmental, social and governance literature: a bibliometric and content analysis

Perspective Chapter: The Environmental, Social, and Governance (ESG) Investment and Its Implications

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