Saharti, Mohammed, Chaudhry, Sajid M., Pekar, Viktor and Bajoori, Elnaz (2024). Environmental, social and governance (ESG) performance of firms in the era of geopolitical conflicts. Journal of Environmental Management, 351 ,
Abstract
Do geopolitical conflicts matter for the environmental, social, governance (ESG) and overall ESG performance of firms? We answer this question by studying the impact of geopolitical conflict of a country on the ESG performance, separately and collectively, of firms of that country. We use data from Refinitiv and UCDP/PRIO (Uppsala Conflict Data Program/International Peace Research Institute, Oslo) databases for the period from 2002 to 2021 for 79 countries and we use fixed effects regression as our main methodology. We find that if a country is in a geopolitical conflict, their firms are impacted in the form of lower E, S and G performance and overall ESG performance, with stronger effects for developed countries. This comes on top of the direct costs of geopolitical conflicts. Our results are robust to country, year and firm fixed effects as well as robust to endogeneity as we use Lewbel (2012) estimator to eliminate any chances of endogeneity. We provide first evidence on this topic and it has geopolitical and socioeconomical implications.
Publication DOI: | https://doi.org/10.1016/j.jenvman.2023.119744 |
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Divisions: | College of Business and Social Sciences > Aston Business School College of Business and Social Sciences > Aston Business School > Centre for Personal Financial Wellbeing College of Business and Social Sciences > Aston Business School > Economics, Finance & Entrepreneurship College of Business and Social Sciences > Aston Business School > Operations & Information Management Aston University (General) |
Additional Information: | Copyright © 2023, Elsevier. This accepted manuscript version is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 4.0 International https://creativecommons.org/licenses/by-nc-nd/4.0/ |
Publication ISSN: | 1095-8630 |
Last Modified: | 11 Nov 2024 09:00 |
Date Deposited: | 11 Dec 2023 09:47 |
Full Text Link: | |
Related URLs: |
https://www.sci ... 532X?via%3Dihub
(Publisher URL) |
PURE Output Type: | Article |
Published Date: | 2024-02 |
Published Online Date: | 2023-12-07 |
Accepted Date: | 2023-11-29 |
Authors: |
Saharti, Mohammed
Chaudhry, Sajid M. ( 0000-0001-8769-8920) Pekar, Viktor ( 0000-0002-9664-1675) Bajoori, Elnaz |
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Version: Accepted Version
Access Restriction: Restricted to Repository staff only until 7 December 2024.
License: Creative Commons Attribution Non-commercial No Derivatives