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In partnership for the goals? The level of agreement between SDG ratings

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  • Bauckloh, Tobias
  • Dobrick, Juris
  • Höck, André
  • Utz, Sebastian
  • Wagner, Marcus

Abstract

This study analyzes the level of agreement of Sustainable Development Goal (SDG) ratings across five different rating providers. It documents a low level of agreement that is particularly pronounced for companies from the Energy, Healthcare, and Basic Materials sectors. Moreover, the low level of agreement is mostly driven by some individual SDGs. When analyzing implications, we find different return characteristics and risk factor exposures of portfolios sorted according to SDG ratings of different rating providers. Overall, our analyses show that current SDG ratings fail to provide a clear signal of companies’ contribution to the SDGs which can have severe consequences for sustainability transitions and their financing.

Suggested Citation

  • Bauckloh, Tobias & Dobrick, Juris & Höck, André & Utz, Sebastian & Wagner, Marcus, 2024. "In partnership for the goals? The level of agreement between SDG ratings," Journal of Economic Behavior & Organization, Elsevier, vol. 217(C), pages 664-678.
    • Handle: RePEc:eee:jeborg:v:217:y:2024:i:c:p:664-678
    DOI: 10.1016/j.jebo.2023.11.014
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    References listed on IDEAS

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    More about this item

    Keywords

    Sustainable development goals; Disagreement; Portfolio management; Ratings;
    All these keywords.

    JEL classification:

    • G1 - Financial Economics - - General Financial Markets
    • C5 - Mathematical and Quantitative Methods - - Econometric Modeling
    • Q5 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics

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