Abstract

http://ssrn.com/abstract=1663444
 
 

References (31)



 
 

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The Independent Effects of Environmental, Social and Governance Initiatives on the Performance of UK Firms


Jacquelyn Humphrey


Australian National University (ANU) - School of Finance and Applied Statistics; Financial Research Network (FIRN)

Darren D. Lee


University of Queensland - Business School

Yaokan Shen


University of Queensland - Business School

August 22, 2010

23rd Australasian Finance and Banking Conference 2010 Paper

Abstract:     
We investigate the effect of environmental, social and governance factors on the financial performance of a sample UK firms. We examine the three factors separately in order to disentangle the relation of each with financial performance. We find that, overall, there is no difference in the performance of firms which achieve high or low environmental, social or governance rankings. Additionally, high and low ranking firms do not appear very different in terms of their systematic risks, book-to-market ratios or momentum exposures. However, high-rated firms are consistently larger in size. Our results indicate that UK investors are free to incorporate environmental, social or governance information into their investment strategies without incurring any significant financial cost (or benefit) in terms of risk or return.

Number of Pages in PDF File: 33

Keywords: Sustainability, Environment, Social, Governance, Corporate social performance, Corporate financial performance, UK evidence, Best of sector.

JEL Classification: G30, G11, Q56

working papers series


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Date posted: August 23, 2010  

Suggested Citation

Humphrey, Jacquelyn and Lee, Darren D. and Shen, Yaokan, The Independent Effects of Environmental, Social and Governance Initiatives on the Performance of UK Firms (August 22, 2010). 23rd Australasian Finance and Banking Conference 2010 Paper. Available at SSRN: http://ssrn.com/abstract=1663444 or http://dx.doi.org/10.2139/ssrn.1663444

Contact Information

Jacquelyn Humphrey (Contact Author)
Australian National University (ANU) - School of Finance and Applied Statistics ( email )
Canberra, Australian Capital Territory 0200
Australia
Financial Research Network (FIRN)
C/- University of Queensland Business School
St Lucia, 4071 Brisbane
Queensland
Australia
HOME PAGE: http://www.firn.org.au

Darren David Lee
University of Queensland - Business School ( email )
4072 Brisbane, Queensland
Australia
Yaokan Shen
University of Queensland - Business School ( email )
Brisbane, Queensland 4072
Australia
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