Institutional Investors and Corporate Environmental and Financial Performance

European Financial Management, forthcoming

58 Pages Posted: 2 Mar 2020 Last revised: 12 Sep 2022

See all articles by Steve Miller

Steve Miller

University of South Florida - Muma College of Business

Bin Qiu

Missouri Western State University, Craig School of Business

Bin Wang

Marquette University - College of Business Administration

Tina Yang

University of South Florida - Muma College of Business

Date Written: August 18, 2022

Abstract

We propose a conceptual framework to illustrate that when three conditions hold, institutional investors moderate a positive relation between corporate financial performance (CFP) and corporate environmental performance (CEP). We explore heterogeneities across institution types to demonstrate the importance of each condition. The moderating effect works through the channels of expert consulting and effective monitoring. Our results have important policy and practical implications given the global trend of ownership concentration in institutional investors and the projection that by 2025, one out of three dollars under professional management will be invested in corporate social responsibility (CSR) assets.

Keywords: Corporate environmental performance; Environmental, social, and governance; Sustainability; Institutional investors; Shareholder theory; Stakeholder theory; Delegated philanthropy theory

JEL Classification: D22; G34; M14

Suggested Citation

Miller, Steve and Qiu, Bin and Wang, Bin and Yang, Tina, Institutional Investors and Corporate Environmental and Financial Performance (August 18, 2022). European Financial Management, forthcoming, Available at SSRN: https://ssrn.com/abstract=3531077 or http://dx.doi.org/10.2139/ssrn.3531077

Steve Miller

University of South Florida - Muma College of Business ( email )

Sarasota, FL 33620
United States

Bin Qiu

Missouri Western State University, Craig School of Business ( email )

4525 Downs Drive Popplewell Hall
Saint Joseph, MO 64506
United States
8162715954 (Phone)

HOME PAGE: http://www.missouriwestern.edu

Bin Wang

Marquette University - College of Business Administration ( email )

P.O. Box 1881
Milwaukee, WI 53201-1881
United States

Tina Yang (Contact Author)

University of South Florida - Muma College of Business ( email )

140 7th Ave S
St. Petersburg, FL 33701
United States
7278734568 (Phone)

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