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Dow Jones Sustainability Indices and ESG Scores: Do They Tell the Same Story?

Author

Listed:
  • Minoo Tehrani

    (Gabelli School of Business, Roger Williams University, Bristol, RI 02809, USA)

  • Andreas Rathgeber

    (Institute of Materials Resource Management, University of Augsburg, 86159 Augsburg, Germany)

  • Edward Dougherty

    (Mathematical Sciences, Salve Regina University, Newport, RI 02840, USA)

  • Lawrence Fulton

    (Boston College, Woods College of Advance Studies, Chestnut Hill, MA 02467, USA)

  • James Fournier

    (Gabelli School of Business, Roger Williams University, Bristol, RI 02809, USA)

Abstract

The focal point of this research is to compare two of the largest global organizations’ sustainability indices and scores, namely Dow Jones Sustainability Indices (DJSIs) and Standard & Poor’s Global (S&P Global) ESG scores (environmental, social, and governance), which rank companies based on their sustainability practices, and to learn if they correspond to each other. Considering that Germany is the hub of large companies from leading global industries, this research compares the ESG scores of the German companies that appear on the Dow Jones Sustainability Indices. Several statistical analyses are conducted to determine if the German companies on the DJSIs correspond with high ESG scores. The years under consideration are 2018 through 2023. The results of this research indicate that DJSIs and ESG scores do not tell the same story and there are discrepancies regarding the sustainability practices of the studied companies that are added to the DJSIs and the assigned high ESG scores by S&P Global.

Suggested Citation

  • Minoo Tehrani & Andreas Rathgeber & Edward Dougherty & Lawrence Fulton & James Fournier, 2024. "Dow Jones Sustainability Indices and ESG Scores: Do They Tell the Same Story?," Sustainability, MDPI, vol. 16(14), pages 1-18, July.
    • Handle: RePEc:gam:jsusta:v:16:y:2024:i:14:p:6110-:d:1437174
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    References listed on IDEAS

    as
    1. Ester Clementino & Richard Perkins, 2021. "How Do Companies Respond to Environmental, Social and Governance (ESG) ratings? Evidence from Italy," Journal of Business Ethics, Springer, vol. 171(2), pages 379-397, June.
    2. Meltem Kılıç & Hasan Emin Gurler & Ahmet Kaya & Chang Won Lee, 2022. "The Impact of Sustainability Performance on Financial Performance: Does Firm Size Matter? Evidence from Turkey and South Korea," Sustainability, MDPI, vol. 14(24), pages 1-19, December.
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