ESG as a Booster for Logistics Stock Returns—Evidence from the US Stock Market

This article investigates the connection between US logistics companies’ commitment to environmental, social and fair governance (ESG) strategy and their performance on the US stock market during the 2007–2022 period. The research considers historical data analysis, CAPM and a comparison of optimise...

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Bibliographic Details
Published in:Sustainability 2022-09, Vol.14 (19), p.12356
Main Authors: Rodionova, Maria, Skhvediani, Angi, Kudryavtseva, Tatiana
Format: Article
Language:English
Subjects:
Abnormal returns
Business valuation
Capital assets
Climate change
Coronaviruses
Corporate governance
COVID-19
Environmental aspects
Investments
Logistics
Logistics services
Pandemics
Portfolio performance
Portfolios
Return on investment
Securities markets
Social aspects
Stock exchanges
Stock markets
Sustainability
Volatility
Workplace diversity
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Summary:This article investigates the connection between US logistics companies’ commitment to environmental, social and fair governance (ESG) strategy and their performance on the US stock market during the 2007–2022 period. The research considers historical data analysis, CAPM and a comparison of optimised portfolios. According to the results of the analyses, ‘green’ logistics stocks are less volatile, and hence less risky, and more profitable compared to ‘non-green’ logistics stocks. The Great Recession (2007–2009) and the COVID-19 pandemic (2020) had the greatest impact on stock volatility, in terms of the US stock market. Optimised during the time of the Ukrainian crisis, green logistics portfolios were shown to have higher returns, but also risks and Sharpe ratios, than ‘non-green’ ones. The results confirm there to be a connection between companies’ commitment to ESG strategy and enhanced stock performance, which contributes to the importance of the ESG agenda.
ISSN:2071-1050
2071-1050
DOI:10.3390/su141912356