Corporate performance and sustainability: evidence from the Iberian market

• Autor(a) principal: Magalhães, Beatriz Soares
• Data de Publicação: 2021
• Tipo de documento: Dissertação
• Idioma: eng
• Título da fonte: Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos)
• Texto Completo: http://hdl.handle.net/10362/133489
• topic: Energy; Fixed income; Domínio/Área Científica::Ciências Sociais::Economia e Gestão

This work project examines the relationship of corporate performance with sustainability in the Iberia from the period 2010 to 2019. To study this relationship, two different ESG scores were used: ESG disclosure score from Bloomberg which reflects the transparency of a firm’s ESG reporting, and ESG performance score from Thomson Reuters which reflects the performance, commitment and effectiveness of a company in terms of ESG. Regarding corporate performance, this paper has focused on the accounting performance by using Ro A and Ro E, and market performance by using Tobin’s Q. A fixed effect model was used and the base line specification was augmented to further analyse the effect of firm size. The results indicate that, on average, ESG disclosure score positively impacts a firm’s performance and the ESG performance score negatively impacts a firm’s performance. More specifically, one could observe that, on average, smaller firms benefit more from operational performance when disclose on ESG criteria, while larger firms benefit financially and operationally when to committed and focused on performing in terms of the ESG criteria. These results highlight the importance and benefits of adopting social and green policies by companies to improve their corporate performance. Keywords: ESG performance, ESG, CSR, financial performance, ROA, ROE, Tobin’s Q.