Evaluation of strategic and financial variables of corporate sustainability and ESG policies on corporate finance performance

Weston, Piers; Nnadi, Matthias

doi:10.1080/20430795.2021.1883984

Cited by 56 publications

(44 citation statements)

References 43 publications

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“…The social responsibility can affect the reputation of companies and customer satisfaction, which increases their value during their practice of the social responsibility activities (Landi & Sciarelli, 2018;Gillan et al, 2021;Chen et al, 2021). These results are consistent with some other studies that showed a positive relation between the company's social responsibility and its reputation (Karwowski & Raulinajtys-Grzybek, 2021;Gillan et al, 2021;Weston & Nnadi, 2021). These studies indicated that the increased disclosure of the social responsibility practices increases its market value and profitability (Jordaan et al, 2018;Kuo et al, 2021;Mohammad & Wasiuzzaman, 2021).…”

Section: Second: Strategy Of the Social Performancesupporting

confidence: 88%

impact of ESG strategies integration on the operational and reputational risks

Al-Qaruty¹,

Alhorani²,

Dabbaghia³

et al. 2022

ijhs

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This study aimed to demonstrate the impact of strategies integration of environmental, social and corporate governance strategies (ESG) on operational and reputational risks: a literature review for insurance companies listed on the Amman Stock Exchange. where the study population consisted of 22 Jordanian insurance companies, while the sample consisted of 8 companies, and one was excluded due to the lack of data, and based on the descriptive analytical approach, the study reviewed many previous studies related to its subject, and using the method of content analysis for annual reports and disclosures issued by Major insurance companies during the period 2020-2021, where a survey list was designed to measure the extent of the research companies' commitment to environmental, social and corporate governance strategies. The study concluded with many results, perhaps the most prominent of which is the presence of disclosure about social responsibility activities in the annual reports, and that all companies focused in their activities on providing donations and support to the local community and supporting education and health issues during the Covid pandemic period,,,

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Section: Second: Strategy Of the Social Performancesupporting

confidence: 88%

impact of ESG strategies integration on the operational and reputational risks

Al-Qaruty¹,

Alhorani²,

Dabbaghia³

et al. 2022

ijhs

View full text Add to dashboard Cite

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“…Nevertheless, there are also studies showing negative effects, for instance suggesting that firm investment in SP diverts funds that could be used for productive investment (Smith and Sims, 1985; Peng and Yang, 2014). There are also studies reporting no relationship between SP and FP (Fauzi et al , 2007; Weston and Nnadi, 2021).…”

Section: Theoretical Framework and Hypothesis Developmentmentioning

confidence: 99%

Do sustainability practices influence financial performance? Evidence from the Nordic financial industry

Rahi

Akter

Johansson

2021

ARJ

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Purpose The purpose of this study is to explore the impact of sustainability (environmental, social and governance or ESG) practices on the financial performance (FP) of the Nordic financial industry. Design/methodology/approach The study covers a sample selection of observations for a total of 152 firm-years for 39 financial companies within the Nordic region (Sweden, Denmark, Finland and Norway) for the business years including 2015–2019. Data regarding ESG and FP indicators were extracted from the Thomson Reuters Eikon database in July 2020. This is a quantitative study using regression and a generalized method of moments. Findings Using static and dynamic estimators, the authors found both positive and negative impacts of sustainability practice on FP. The authors identified a negative relationship between ESG practices and FP (return on invested capital, return on equity and earnings per share). The authors identified a positive relationship between governance and return on assets. Originality/value A key contribution to the accounting literature is the finding that there is a risk for financial firms in adopting sustainability practices, as they follow a logic that contradicts the purely economic rationale. On the other hand, the positive relationship between governance and FP helps not only companies but also regulators and researchers to understand the positive impact of a good governance structure.

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“…First, we examine how corporate ownership and equity funds are (involuntarily) responsible for investment in the firms that are deemed problematic with the ESG (Environment, Society and Governance) standards. While the literature has recognized that “ESG is being incorporated into other portfolio products, such as ETFs” in the last several years [ 20 ], and the scholarly literature has exclusively addressed the impact of ESG scores on the financial performance of ETFs, corporate profitability, and investment decision-making among others [ 21 , 22 ]. Our analysis differs from the existing studies in that we study the connectivity of corporate ownership and investment funds to non-ESG firms, rather than the impact of ESG standards.…”

Section: Discussionmentioning

confidence: 99%

Socially responsible investing through the equity funds in the global ownership network

et al. 2021

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We analyze the connectivity of equity investments to the firms in the global ownership network that are reported as non-compliant with Environment, Social, and Government (ESG) benchmarks. We find that a large number of shareholders have ownership linkages to non-ESG firms, most commonly with three or four degrees of separation. Analyzing the betweenness centrality for shareholders connecting the ultimate owners and non-ESG firms, we find that the investment management companies play important roles in channeling the investment money into non-ESG firms, where largest American asset managers commonly have one to two degrees of separation on their ownership linkages to those problematic firms. Since asset managers collect capital from investors by running the equity funds, we analyze the ownership stakes and the associated voting rights attributable to the equity funds investors. We estimate the distribution of the power of corporate control over non-ESG firms among specific asset managers (such as BlackRock and Fidelity) and among different types of the equity funds (such as mutual funds and exchanged-traded funds), and explores how investing in the equity funds rather than ownership investing may have shifted the distribution of the power to control those non-ESG firms.

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Evaluation of strategic and financial variables of corporate sustainability and ESG policies on corporate finance performance

Cited by 56 publications

References 43 publications

impact of ESG strategies integration on the operational and reputational risks

impact of ESG strategies integration on the operational and reputational risks

Do sustainability practices influence financial performance? Evidence from the Nordic financial industry

Socially responsible investing through the equity funds in the global ownership network

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