Does ESG Investment Influence Firm Risk During the COVID-19 Pandemic? Evidence from European Markets

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dc.contributor.authorSelimefendigil, Seyfullah
dc.date.accessioned2025-02-20T08:42:13Z
dc.date.available2025-02-20T08:42:13Z
dc.date.issued2024
dc.departmentTürk-Alman Üniversitesien_US
dc.description.abstractIn recent decades, corporate social performance (CSP) has gained in importance. Because of concerns raised by consumers, investors, fund providers, and governmental organizations about sustainability, businesses are motivated to work toward a more sustainable environment. This paper examines the nexus between environmental, social, and governance factors (ESG) and various risk types, including market and accounting-based risk, using a data set comprising 1400 firm- year observations spanning the period from 2015 to 2022 from European countries. It examines both aggregated and disaggregated ESG scores and their associations with accounting-based default risk, measured by Altman's Z and Zmijewski's ZM-scores, as well as market risk proxied by beta. To explore the nexus between ESG and risk factors, panel data analysis with both time and unit effects was used and considered with cluster robust standard errors. This study shows that economic cycles have an impact on these relationships, with ESG factors demonstrating a risk-mitigating effect during the COVID-19 pandemic, but no impact before the COVID-19 pandemic. Moreover, this study highlights the comparative informativeness of measuring systematic beta risk compared with traditional accounting-based risk assessments.
dc.identifier.doi10.26650/ibr.2024.53.1429651
dc.identifier.endpage432en_US
dc.identifier.issn2630-5488
dc.identifier.issue3en_US
dc.identifier.startpage409en_US
dc.identifier.urihttps://doi.org/10.26650/ibr.2024.53.1429651
dc.identifier.urihttps://hdl.handle.net/20.500.12846/1579
dc.identifier.volume53en_US
dc.identifier.wosWOS:001407842500005
dc.indekslendigikaynakWeb of Science
dc.institutionauthorSelimefendigil, Seyfullah
dc.language.isoen
dc.publisherIstanbul Univ, Sch Business
dc.relation.ispartofIstanbul Business Research
dc.relation.publicationcategoryMakale - Uluslararası Hakemli Dergi - Kurum Öğretim Elemanı
dc.rightsinfo:eu-repo/semantics/closedAccess
dc.snmzKA_WOS_20250220
dc.subjectCorporate Social Performanceen_US
dc.subjectCOVID-19en_US
dc.subjectFirm risken_US
dc.subjectStakeholder Theoryen_US
dc.subjectAgency Theoryen_US
dc.titleDoes ESG Investment Influence Firm Risk During the COVID-19 Pandemic? Evidence from European Markets
dc.typeArticle

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