ESG news spillovers across the value chain

We document the impact of ESG shocks on the stock returns of suppliers and clients of affected firms. Our empirical analysis of US stocks, along with their global clients and suppliers, reveals that ESG shocks are integrated into prices intradaily and that the cross‐effect between shocks and ESG lev...

Full description

Saved in:
Bibliographic Details
Published in:Financial management 2023-12, Vol.52 (4), p.677-710
Main Authors: Le Tran, Vu, Coqueret, Guillaume
Format: Article
Language:English
Subjects:
Business administration
Corporate governance
Corporate social responsibility
Customers
Economic aspects
Economics and Finance
Environmental aspects
Environmental sustainability
Externalities (Economics)
Humanities and Social Sciences
Management
Media coverage
News
Prices
Small business
Social aspects
Stock markets
Sustainable development
Value chain
Citations: Items that this one cites
Items that cite this one
Online Access:Get full text
Tags: Add Tag
No Tags, Be the first to tag this record!
Description
Summary:We document the impact of ESG shocks on the stock returns of suppliers and clients of affected firms. Our empirical analysis of US stocks, along with their global clients and suppliers, reveals that ESG shocks are integrated into prices intradaily and that the cross‐effect between shocks and ESG levels is statistically significant. The indirect diffusion of ESG shocks to customers' and suppliers' returns is also significant, but takes more time (a few days) and is less pronounced. Finally, the impact is stronger for small firms and for corporations that benefit from less media coverage. In addition, effects are more pronounced in the recent period (posterior to 2017), possibly due to increased investor attention toward sustainability.
ISSN:0046-3892
1755-053X
DOI:10.1111/fima.12431