Research Article
BibTex RIS Cite
Year 2023, Volume: 17 Issue: 1, 228 - 229, 30.07.2023
https://doi.org/10.17261/Pressacademia.2023.1795

Abstract

References

  • Ersoy, E., Swiecka, B., Grima, S., Özen, E., & Romanova, I. (2022, August 3). The Impact of ESG Scores on Bank Market Value? Evidence from the U.S. Banking Industry. Sustainability, 14(15), 9527. https://doi.org/10.3390/su14159527
  • Krosinsky, C., & Robins, N. (Eds.). (2008, October 28). Sustainable Investing: The Art of Long-Term Performance. https://doi.org/10.1604/9781844075485
  • Limkriangkrai, M., Koh, S., & Durand, R. B. (2016, September 19). Environmental, Social, and Governance (ESG) Profiles, Stock Returns, and Financial Policy: Australian Evidence. International Review of Finance, 17(3), 461–471. https://doi.org/10.1111/irfi.12101
  • Buallay, A., Fadel, S. M., Al-Ajmi, J. Y., & Saudagaran, S. (2020, March 27). Sustainability reporting and performance of MENA banks: is there a trade-off? Measuring Business Excellence, 24(2), 197–221. https://doi.org/10.1108/mbe-09-2018-0078
  • Yoon, B., Lee, J., & Byun, R. (2018, October 11). Does ESG Performance Enhance Firm Value? Evidence from Korea. Sustainability, 10(10), 3635. https://doi.org/10.3390/su10103635
  • Demiraj, R., Dsouza, S., & Demiraj, E. (2023, January 31). ESG scores relationship with firm performance: panel data evidence from the European tourism industry. Pressacademia. https://doi.org/10.17261/pressacademia.2023.1674
  • Gillan, S. L., Koch, A., & Starks, L. T. (2021, February). Firms and social responsibility: A review of ESG and CSR research in corporate finance. Journal of Corporate Finance, 66, 101889. https://doi.org/10.1016/j.jcorpfin.2021.101889
  • Syed, A. M. (2014, January). “Environment, Social and Governance (ESG) criteria and preference of Managers.” Academy of Management Proceedings, 2014(1), 12048. https://doi.org/10.5465/ambpp.2014.12048abstract
  • Rompotis, G. G. (2023, April 6). Do ESG ETFs “Greenwash”? Evidence from the US Market. The Journal of Impact and ESG Investing, jesg.2023.1.070. https://doi.org/10.3905/jesg.2023.1.070
  • Panagopoulos, A. (2023). The Use of Sustainable Financial Instruments In Relation To The Social Impact Investment. ESG Policies, Capital Markets’ Approach and Investors’ Protection. An Innovative Perspective. SSRN Electronic Journal. https://doi.org/10.2139/ssrn.4131735
  • De, I., & Clayman, M. R. (2015, November 18). The Benefits of Socially Responsible Investing:An Active Manager’s Perspective. The Journal of Investing. https://doi.org/10.3905/joi.2015.2015.1.048
  • Cheng, R., Kim, H., & Ryu, D. (2023). ESG Performance and Firm Value during the COVID-19 Pandemic: In the Case of the Chinese Market. SSRN Electronic Journal. https://doi.org/10.2139/ssrn.4343858
  • Kubota, K., & Takehara, H. (2003). Financial Sector Risk and the Stock Returns: Evidence from Tokyo Stock Exchange Firms. Asia-Pacific Financial Markets, 10(1), 1–28. https://doi.org/10.1023/b:fejm.0000039876.65786.c2
  • Zehir, E., & Aybars, A. (2020, November 5). Is there any effect of ESG scores on portfolio performance? Evidence from Europe and Turkey. Journal of Capital Markets Studies, 4(2), 129–143. https://doi.org/10.1108/jcms-09-2020-0034
  • Zakhmatov, D. Y. (2022). Internatıonal practıces of supportıng the prıncıples of sustaınable development and management of envıronmental, socıal and corporate governance rısks. Innovatsionnoe Razvitie Ekonomiki, 3–4, 108–120. https://doi.org/10.51832/2223798420223-4108
  • Azmi, W., Hassan, M. K., Houston, R., & Karim, M. S. (2021, January). ESG activities and banking performance: International evidence from emerging economies. Journal of International Financial Markets, Institutions and Money, 70, 101277. https://doi.org/10.1016/j.intfin.2020.101277
  • Sultana, S., Zulkifli, N., & Zainal, D. (2018, June 1). Environmental, Social and Governance (ESG) and Investment Decision in Bangladesh. Sustainability, 10(6), 1831. https://doi.org/10.3390/su10061831

ELABORATING ESG CRITERIA IN INVESTMENTS

Year 2023, Volume: 17 Issue: 1, 228 - 229, 30.07.2023
https://doi.org/10.17261/Pressacademia.2023.1795

Abstract

Purpose- The aim of this study is to conduct a comprehensive analysis of ESG criteria in investments, and to investigate the potential correlation between ESG pillar scores (i.e., environmental, social, and governance) and the market value of banks. Moreover, the study seeks to identify the areas where ESG performance is most valuable and relevant. ESG investment is a contentious subject, and there are varying perspectives regarding the appropriate weight given to ESG pillars when investing and managing certain banks. The study aims to establish ESG goals and means, define, evaluate, and report ESG performance of firms, and assist investors in comprehending the significance of ESG criteria in making informed investment decisions. Finally, the study provides insights into the implications of ESG investment for businesses and the capital markets as a whole.
Methodology- To investigate the correlation of ESG scores on the market value of banks, a quantitative research methodology was employed, which involved a thematic analysis to identify and analyse relevant data. The dataset for this study was obtained from Thomson Reuters database, and it includes data from the past 10 years’ operating in the Turkish and Swiss banks.
Findings- The findings of the study suggest that ESG factors have a stronger and more significant impact on the market values of Swiss banks compared to Turkish banks. The higher degree of integration and alignment between ESG concerns and market value is evident through the stronger correlations observed between ESG scores, market capitalization, and the individual pillars within Swiss banks. This implies that Swiss banks have demonstrated a better incorporation of ESG considerations into their market valuations, potentially reflecting their stronger focus on sustainability, responsible business practices, and investor demands for ESG-related performance. Overall, these empirical findings support the hypothesis that there is a positive impact of ESG scores on market value of banks.
Conclusion- In sum, the analysis involved examining the correlation between various ESG metrics and market capitalization with a positive correlation between ESG scores and market capitalization in both Turkish and Swiss banks. Specifically, the correlation matrix showed that ESG scores were positively associated with market capitalization, indicating that higher ESG scores were generally accompanied by higher market values. Furthermore, the analysis highlighted the significance of individual ESG pillars. In both Turkish and Swiss banks, the E Pillar Score, S Pillar Score, and G Pillar Score showed positive correlations with market capitalization, suggesting that environmental, social, and governance factors play a role in influencing market value.

References

  • Ersoy, E., Swiecka, B., Grima, S., Özen, E., & Romanova, I. (2022, August 3). The Impact of ESG Scores on Bank Market Value? Evidence from the U.S. Banking Industry. Sustainability, 14(15), 9527. https://doi.org/10.3390/su14159527
  • Krosinsky, C., & Robins, N. (Eds.). (2008, October 28). Sustainable Investing: The Art of Long-Term Performance. https://doi.org/10.1604/9781844075485
  • Limkriangkrai, M., Koh, S., & Durand, R. B. (2016, September 19). Environmental, Social, and Governance (ESG) Profiles, Stock Returns, and Financial Policy: Australian Evidence. International Review of Finance, 17(3), 461–471. https://doi.org/10.1111/irfi.12101
  • Buallay, A., Fadel, S. M., Al-Ajmi, J. Y., & Saudagaran, S. (2020, March 27). Sustainability reporting and performance of MENA banks: is there a trade-off? Measuring Business Excellence, 24(2), 197–221. https://doi.org/10.1108/mbe-09-2018-0078
  • Yoon, B., Lee, J., & Byun, R. (2018, October 11). Does ESG Performance Enhance Firm Value? Evidence from Korea. Sustainability, 10(10), 3635. https://doi.org/10.3390/su10103635
  • Demiraj, R., Dsouza, S., & Demiraj, E. (2023, January 31). ESG scores relationship with firm performance: panel data evidence from the European tourism industry. Pressacademia. https://doi.org/10.17261/pressacademia.2023.1674
  • Gillan, S. L., Koch, A., & Starks, L. T. (2021, February). Firms and social responsibility: A review of ESG and CSR research in corporate finance. Journal of Corporate Finance, 66, 101889. https://doi.org/10.1016/j.jcorpfin.2021.101889
  • Syed, A. M. (2014, January). “Environment, Social and Governance (ESG) criteria and preference of Managers.” Academy of Management Proceedings, 2014(1), 12048. https://doi.org/10.5465/ambpp.2014.12048abstract
  • Rompotis, G. G. (2023, April 6). Do ESG ETFs “Greenwash”? Evidence from the US Market. The Journal of Impact and ESG Investing, jesg.2023.1.070. https://doi.org/10.3905/jesg.2023.1.070
  • Panagopoulos, A. (2023). The Use of Sustainable Financial Instruments In Relation To The Social Impact Investment. ESG Policies, Capital Markets’ Approach and Investors’ Protection. An Innovative Perspective. SSRN Electronic Journal. https://doi.org/10.2139/ssrn.4131735
  • De, I., & Clayman, M. R. (2015, November 18). The Benefits of Socially Responsible Investing:An Active Manager’s Perspective. The Journal of Investing. https://doi.org/10.3905/joi.2015.2015.1.048
  • Cheng, R., Kim, H., & Ryu, D. (2023). ESG Performance and Firm Value during the COVID-19 Pandemic: In the Case of the Chinese Market. SSRN Electronic Journal. https://doi.org/10.2139/ssrn.4343858
  • Kubota, K., & Takehara, H. (2003). Financial Sector Risk and the Stock Returns: Evidence from Tokyo Stock Exchange Firms. Asia-Pacific Financial Markets, 10(1), 1–28. https://doi.org/10.1023/b:fejm.0000039876.65786.c2
  • Zehir, E., & Aybars, A. (2020, November 5). Is there any effect of ESG scores on portfolio performance? Evidence from Europe and Turkey. Journal of Capital Markets Studies, 4(2), 129–143. https://doi.org/10.1108/jcms-09-2020-0034
  • Zakhmatov, D. Y. (2022). Internatıonal practıces of supportıng the prıncıples of sustaınable development and management of envıronmental, socıal and corporate governance rısks. Innovatsionnoe Razvitie Ekonomiki, 3–4, 108–120. https://doi.org/10.51832/2223798420223-4108
  • Azmi, W., Hassan, M. K., Houston, R., & Karim, M. S. (2021, January). ESG activities and banking performance: International evidence from emerging economies. Journal of International Financial Markets, Institutions and Money, 70, 101277. https://doi.org/10.1016/j.intfin.2020.101277
  • Sultana, S., Zulkifli, N., & Zainal, D. (2018, June 1). Environmental, Social and Governance (ESG) and Investment Decision in Bangladesh. Sustainability, 10(6), 1831. https://doi.org/10.3390/su10061831
There are 17 citations in total.

Details

Primary Language English
Subjects Business Administration
Journal Section Articles
Authors

Meryem Loukılı This is me 0009-0007-6101-2549

Vahit Ferhan Benlı 0000-0002-0510-7662

Publication Date July 30, 2023
Published in Issue Year 2023 Volume: 17 Issue: 1

Cite

APA Loukılı, M., & Benlı, V. F. (2023). ELABORATING ESG CRITERIA IN INVESTMENTS. PressAcademia Procedia, 17(1), 228-229. https://doi.org/10.17261/Pressacademia.2023.1795
AMA Loukılı M, Benlı VF. ELABORATING ESG CRITERIA IN INVESTMENTS. PAP. July 2023;17(1):228-229. doi:10.17261/Pressacademia.2023.1795
Chicago Loukılı, Meryem, and Vahit Ferhan Benlı. “ELABORATING ESG CRITERIA IN INVESTMENTS”. PressAcademia Procedia 17, no. 1 (July 2023): 228-29. https://doi.org/10.17261/Pressacademia.2023.1795.
EndNote Loukılı M, Benlı VF (July 1, 2023) ELABORATING ESG CRITERIA IN INVESTMENTS. PressAcademia Procedia 17 1 228–229.
IEEE M. Loukılı and V. F. Benlı, “ELABORATING ESG CRITERIA IN INVESTMENTS”, PAP, vol. 17, no. 1, pp. 228–229, 2023, doi: 10.17261/Pressacademia.2023.1795.
ISNAD Loukılı, Meryem - Benlı, Vahit Ferhan. “ELABORATING ESG CRITERIA IN INVESTMENTS”. PressAcademia Procedia 17/1 (July 2023), 228-229. https://doi.org/10.17261/Pressacademia.2023.1795.
JAMA Loukılı M, Benlı VF. ELABORATING ESG CRITERIA IN INVESTMENTS. PAP. 2023;17:228–229.
MLA Loukılı, Meryem and Vahit Ferhan Benlı. “ELABORATING ESG CRITERIA IN INVESTMENTS”. PressAcademia Procedia, vol. 17, no. 1, 2023, pp. 228-9, doi:10.17261/Pressacademia.2023.1795.
Vancouver Loukılı M, Benlı VF. ELABORATING ESG CRITERIA IN INVESTMENTS. PAP. 2023;17(1):228-9.

PressAcademia Procedia (PAP) publishes proceedings of conferences, seminars and symposiums. PressAcademia Procedia aims to provide a source for academic researchers, practitioners and policy makers in the area of social and behavioral sciences, and engineering.

PressAcademia Procedia invites academic conferences for publishing their proceedings with a review of editorial board. Since PressAcademia Procedia is an double blind peer-reviewed open-access book, the manuscripts presented in the conferences can easily be reached by numerous researchers. Hence, PressAcademia Procedia increases the value of your conference for your participants. 

PressAcademia Procedia provides an ISBN for each Conference Proceeding Book and a DOI number for each manuscript published in this book.

PressAcademia Procedia is currently indexed by DRJI, J-Gate, International Scientific Indexing, ISRA, Root Indexing, SOBIAD, Scope, EuroPub, Journal Factor Indexing and InfoBase Indexing. 

Please contact to procedia@pressacademia.org for your conference proceedings.