IDEAS home Printed from https://ideas.repec.org/a/sgm/resrep/v2i37y2022p4-14.html
   My bibliography  Save this article

The Impact of ESG Factors on Company Share Prices in the European Energy Sector (Wplyw czynnikow ESG na kursy akcji spolek z sektora energetycznego w Europie)

Author

Listed:
  • Aneta Drab

    (Faculty of Management, University of Warsaw, Poland)

Abstract

ESG factors are increasingly becoming an inseparable part in company reports. Despite many difficulties connected with reporting of non-financial activities, there are more and more companies which undertake this difficult task each year. This kind of information is especially important for contemporary investors, who do not only look at the profit on a given investment, but pay more and more attention to the company’s image, methods of operation, approach to employees and the closer and farther environment. The hypothesis was as follows: the ESG factors have an increasing influence on stock prices. A panel study was used for the analysis. The study covered European energy companies which closed their financial year at the end of the calendar years 2010–2021. However, the results of the study did not reliably reflect the impact of ESG on the achieved rates of return because only in the last few years have they begun to gain significance. Previously, their impact was too weak to be shown in studies on larger samples.

Suggested Citation

  • Aneta Drab, 2022. "The Impact of ESG Factors on Company Share Prices in the European Energy Sector (Wplyw czynnikow ESG na kursy akcji spolek z sektora energetycznego w Europie)," Research Reports, University of Warsaw, Faculty of Management, vol. 2(37), pages 4-14.
    • Handle: RePEc:sgm:resrep:v:2:i:37:y:2022:p:4-14
    as

    Download full text from publisher

    File URL: http://www.sim.wz.uw.edu.pl/sites/default/files/artykuly/aneta_drab.pdf
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Andreas Hoepner & Ioannis Oikonomou & Bert Scholtens & Michael Schröder, 2016. "The Effects of Corporate and Country Sustainability Characteristics on The Cost of Debt: An International Investigation," Journal of Business Finance & Accounting, Wiley Blackwell, vol. 43(1-2), pages 158-190, January.
    2. Rodrigo Zeidan & Claudio Boechat & Angela Fleury, 2015. "Developing a Sustainability Credit Score System," Journal of Business Ethics, Springer, vol. 127(2), pages 283-296, March.
    3. Revelli, Christophe, 2017. "Socially responsible investing (SRI): From mainstream to margin?," Research in International Business and Finance, Elsevier, vol. 39(PB), pages 711-717.
    4. Borja Diez-Cañamero & Tania Bishara & Jose Ramon Otegi-Olaso & Rikardo Minguez & José María Fernández, 2020. "Measurement of Corporate Social Responsibility: A Review of Corporate Sustainability Indexes, Rankings and Ratings," Sustainability, MDPI, vol. 12(5), pages 1-36, March.
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Alain Devalle & Simona Fiandrino & Valter Cantino, 2017. "The Linkage between ESG Performance and Credit Ratings: A Firm-Level Perspective Analysis," International Journal of Business and Management, Canadian Center of Science and Education, vol. 12(9), pages 1-53, August.
    2. Orlando Gomes, 2020. "Optimal growth under socially responsible investment: a dynamic theoretical model of the trade-off between financial gains and emotional rewards," International Journal of Corporate Social Responsibility, Springer, vol. 5(1), pages 1-17, December.
    3. Banerjee, Rajabrata & Gupta, Kartick & Mudalige, Priyantha, 2020. "Do environmentally sustainable practices lead to financially less constrained firms? International evidence," International Review of Financial Analysis, Elsevier, vol. 68(C).
    4. Lutfi Abdul Razak & Mansor H. Ibrahim & Adam Ng, 2020. "Which Sustainability Dimensions Affect Credit Risk? Evidence from Corporate and Country-Level Measures," JRFM, MDPI, vol. 13(12), pages 1-22, December.
    5. Eliwa, Yasser & Aboud, Ahmed & Saleh, Ahmed, 2021. "ESG practices and the cost of debt: Evidence from EU countries," CRITICAL PERSPECTIVES ON ACCOUNTING, Elsevier, vol. 79(C).
    6. Alice Martini, 2019. "Socially responsible investing: from the ethical origins to the sustainable development framework of the european union," Public Finance Research Papers 36, Istituto di Economia e Finanza, DSGE, Sapienza University of Rome.
    7. Kirschenmann Karolin, 2022. "The EU Taxonomy’s (Potential) Effects on the Banking Sector and Bank Lending to Firms," The Economists' Voice, De Gruyter, vol. 19(2), pages 275-283, December.
    8. Ballester, Laura & González-Urteaga, Ana & Shen, Long, 2024. "Green bond issuance and credit risk: International evidence," Journal of International Financial Markets, Institutions and Money, Elsevier, vol. 94(C).
    9. Eduardo Jiménez & Marta de la Cuesta-González & Montserrat Boronat-Navarro, 2021. "How Small and Medium-Sized Enterprises Can Uptake the Sustainable Development Goals through a Cluster Management Organization: A Case Study," Sustainability, MDPI, vol. 13(11), pages 1-18, May.
    10. Inese Mavlutova & Andris Fomins & Aivars Spilbergs & Dzintra Atstaja & Janis Brizga, 2021. "Opportunities to Increase Financial Well-Being by Investing in Environmental, Social and Governance with Respect to Improving Financial Literacy under COVID-19: The Case of Latvia," Sustainability, MDPI, vol. 14(1), pages 1-25, December.
    11. Li, WeiWei & Padmanabhan, Prasad & Huang, Chia-Hsing, 2024. "ESG and debt structure: Is the nature of this relationship nonlinear?," International Review of Financial Analysis, Elsevier, vol. 91(C).
    12. Lagoarde-Segot, Thomas & Paranque, Bernard, 2018. "Finance and sustainability: From ideology to utopia," International Review of Financial Analysis, Elsevier, vol. 55(C), pages 80-92.
    13. Emilia Di Lorenzo & Marilena Sibillo, 2020. "Economic Paradigms and Corporate Culture after the Great COVID-19 Pandemic: Towards a New Role of Welfare Organisations and Insurers," Sustainability, MDPI, vol. 12(19), pages 1-14, October.
    14. Mauro Romano & Antonio Netti & Antonio Corvino & Marika Intenza, 2024. "Environmental innovation in healthcare industry: The moderating role of women on board in cost of debt," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 31(3), pages 1921-1933, May.
    15. Jiangying Wei & Ridong Hu & Feng Chen, 2024. "The Path to Sustainable Stability: Can ESG Investing Mitigate the Spillover Effects of Risk in China’s Financial Markets?," Sustainability, MDPI, vol. 16(23), pages 1-25, November.
    16. Gunther Capelle-Blancard & Patricia Crifo & Marc-Arthur Diaye & Rim Oueghlissi & Bert Scholtens, 2016. "Environmental, Social and Governance (ESG) performance and sovereign bond spreads: an empirical analysis of OECD countries," Working Papers hal-01401718, HAL.
    17. Pierdomenico Duttilo & Stefano Antonio Gattone & Barbara Iannone, 2024. "Mixtures of generalized normal distributions and EGARCH models to analyse returns and volatility of ESG and traditional investments," AStA Advances in Statistical Analysis, Springer;German Statistical Society, vol. 108(4), pages 755-775, December.
    18. Lorenzo Ardito, 2023. "The influence of firm digitalization on sustainable innovation performance and the moderating role of corporate sustainability practices: An empirical investigation," Business Strategy and the Environment, Wiley Blackwell, vol. 32(8), pages 5252-5272, December.
    19. Shoonchul Shin & Juyoung Lee & Pratima (Tima) Bansal, 2022. "From a shareholder to stakeholder orientation: Evidence from the analyses of CEO dismissal in large U.S. firms," Strategic Management Journal, Wiley Blackwell, vol. 43(7), pages 1233-1257, July.
    20. Ratajczak Piotr & Mikołajewicz Grzegorz, 2021. "The impact of environmental, social and corporate governance responsibility on the cost of short-and long-term debt," Economics and Business Review, Sciendo, vol. 7(2), pages 74-96, June.

    More about this item

    Keywords

    ESG; share prices; investing; energy sector; panel study;
    All these keywords.

    JEL classification:

    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:sgm:resrep:v:2:i:37:y:2022:p:4-14. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: the person in charge (email available below). General contact details of provider: https://edirc.repec.org/data/somuwpl.html .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.