The role of ESG performance during times of financial crisis: Evidence from COVID-19 in China

We examine the role of ESG performance during market-wide financial crisis, triggered in response to the COVID-19 global pandemic. The unique circumstances create an inimitable opportunity to question if investors interpret ESG performance as a signal of future stock performance and/or risk mitigati...

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Detalles Bibliográficos
Autores principales: Broadstock, David C., Chan, Kalok, Cheng, Louis T.W., Wang, Xiaowei
Formato: Online Artículo Texto
Lenguaje:English
Publicado: Elsevier Inc. 2021
Materias:
Article
Acceso en línea:https://www.ncbi.nlm.nih.gov/pmc/articles/PMC7425769/
https://www.ncbi.nlm.nih.gov/pubmed/32837385
http://dx.doi.org/10.1016/j.frl.2020.101716
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author Broadstock, David C.
Chan, Kalok
Cheng, Louis T.W.
Wang, Xiaowei
author_facet Broadstock, David C.
Chan, Kalok
Cheng, Louis T.W.
Wang, Xiaowei
author_sort Broadstock, David C.
collection PubMed
description We examine the role of ESG performance during market-wide financial crisis, triggered in response to the COVID-19 global pandemic. The unique circumstances create an inimitable opportunity to question if investors interpret ESG performance as a signal of future stock performance and/or risk mitigation. Using a novel dataset covering China’s CSI300 constituents, we show (i) high-ESG portfolios generally outperform low-ESG portfolios (ii) ESG performance mitigates financial risk during financial crisis and (iii) the role of ESG performance is attenuated in ‘normal’ times, confirming its incremental importance during crisis. We phrase the results in the context of ESG investment practices.
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spelling pubmed-74257692020-08-14 The role of ESG performance during times of financial crisis: Evidence from COVID-19 in China Broadstock, David C. Chan, Kalok Cheng, Louis T.W. Wang, Xiaowei Financ Res Lett Article We examine the role of ESG performance during market-wide financial crisis, triggered in response to the COVID-19 global pandemic. The unique circumstances create an inimitable opportunity to question if investors interpret ESG performance as a signal of future stock performance and/or risk mitigation. Using a novel dataset covering China’s CSI300 constituents, we show (i) high-ESG portfolios generally outperform low-ESG portfolios (ii) ESG performance mitigates financial risk during financial crisis and (iii) the role of ESG performance is attenuated in ‘normal’ times, confirming its incremental importance during crisis. We phrase the results in the context of ESG investment practices. Elsevier Inc. 2021-01 2020-08-13 /pmc/articles/PMC7425769/ /pubmed/32837385 http://dx.doi.org/10.1016/j.frl.2020.101716 Text en © 2020 Elsevier Inc. All rights reserved. Since January 2020 Elsevier has created a COVID-19 resource centre with free information in English and Mandarin on the novel coronavirus COVID-19. The COVID-19 resource centre is hosted on Elsevier Connect, the company's public news and information website. Elsevier hereby grants permission to make all its COVID-19-related research that is available on the COVID-19 resource centre - including this research content - immediately available in PubMed Central and other publicly funded repositories, such as the WHO COVID database with rights for unrestricted research re-use and analyses in any form or by any means with acknowledgement of the original source. These permissions are granted for free by Elsevier for as long as the COVID-19 resource centre remains active.
spellingShingle Article
Broadstock, David C.
Chan, Kalok
Cheng, Louis T.W.
Wang, Xiaowei
The role of ESG performance during times of financial crisis: Evidence from COVID-19 in China
title The role of ESG performance during times of financial crisis: Evidence from COVID-19 in China
title_full The role of ESG performance during times of financial crisis: Evidence from COVID-19 in China
title_fullStr The role of ESG performance during times of financial crisis: Evidence from COVID-19 in China
title_full_unstemmed The role of ESG performance during times of financial crisis: Evidence from COVID-19 in China
title_short The role of ESG performance during times of financial crisis: Evidence from COVID-19 in China
title_sort role of esg performance during times of financial crisis: evidence from covid-19 in china
topic Article
url https://www.ncbi.nlm.nih.gov/pmc/articles/PMC7425769/
https://www.ncbi.nlm.nih.gov/pubmed/32837385
http://dx.doi.org/10.1016/j.frl.2020.101716
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