Corporate Governance, ESG, and Stock Returns Around the World

Financial Analysts Journal, vol. 75, no. 4 (Fourth Quarter 2019)

44 Pages Posted: 12 Nov 2018 Last revised: 31 Oct 2019

See all articles by Mozaffar Khan

Mozaffar Khan

University of Minnesota - Twin Cities - Carlson School of Management; Causeway Capital Management, LLC

Date Written: July 30, 2019

Abstract

Non-financial performance measures, such as Environmental, Social, and Governance (“ESG”) measures, are potentially leading indicators of firms’ financial performance. I draw on the prior academic literature and the concept of ESG materiality to develop new corporate governance and ESG metrics. The new governance and ESG metrics predicted stock returns in a global investable universe over the tested period, suggesting potential investment value in curated ESG signals.

Keywords: Corporate Governance, ESG, Stock Returns, Global Equities

JEL Classification: G11, G12, G15, G30, G34, M41

Suggested Citation

Khan, Mozaffar and Khan, Mozaffar, Corporate Governance, ESG, and Stock Returns Around the World (July 30, 2019). Financial Analysts Journal, vol. 75, no. 4 (Fourth Quarter 2019), Available at SSRN: https://ssrn.com/abstract=3279830 or http://dx.doi.org/10.2139/ssrn.3279830

Mozaffar Khan (Contact Author)

Causeway Capital Management, LLC

University of Minnesota - Twin Cities - Carlson School of Management ( email )

19th Avenue South
Minneapolis, MN 55455
United States

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