ESG investing and the financial performance: a panel data analysis of developed REIT markets

Kód výsledku v IS VaVaI

<a href="https://www.isvavai.cz/riv?ss=detail&h=RIV%2F45773009%3A_____%2F23%3AN0000010" target="_blank" >RIV/45773009:_____/23:N0000010 - isvavai.cz</a>

Výsledek na webu

<a href="https://link.springer.com/article/10.1007/s11356-023-28376-1" target="_blank" >https://link.springer.com/article/10.1007/s11356-023-28376-1</a>

DOI - Digital Object Identifier

<a href="http://dx.doi.org/10.1007/s11356-023-28376-1" target="_blank" >10.1007/s11356-023-28376-1</a>

Jazyk výsledku

angličtina

Název v původním jazyce

ESG investing and the financial performance: a panel data analysis of developed REIT markets

Popis výsledku v původním jazyce

This study investigates the empirical link between the social and financial performance of the Real Estate Investment Trusts (REITs) by utilizing the PVAR-Granger causality model and a fixed-effects panel data model with a rich dataset comprising 234 ESG-rated REITs across five developed economies from 2003 to 2019. The results suggest that investors pay attention to individual E/S/G metrics and price each component of ESG investing differently, with E-investing and S-investing practices being the significant financial performance factors of REITs. This study is the first attempt to test the social impact and risk mitigation hypotheses of the stakeholder theory of the corporation and the neoclassic trade-off argument to explore the association between corporate social responsibility and the market valuation of REITs. The full sample results strongly support the trade-off hypothesis, indicating that REITs’ environmental policies involve high financial costs that may drain off capital and lead to decreasing market returns. On the contrary, investors have attached a higher value to S-investing performance, especially in the post-GFC period from 2011 to 2019. A positive premium for S-investing supports the stakeholder theory as the social impact could be monetarized into a higher return and a lower systematic risk and give rise to a competitive advantage.

Název v anglickém jazyce

ESG investing and the financial performance: a panel data analysis of developed REIT markets

Popis výsledku anglicky

This study investigates the empirical link between the social and financial performance of the Real Estate Investment Trusts (REITs) by utilizing the PVAR-Granger causality model and a fixed-effects panel data model with a rich dataset comprising 234 ESG-rated REITs across five developed economies from 2003 to 2019. The results suggest that investors pay attention to individual E/S/G metrics and price each component of ESG investing differently, with E-investing and S-investing practices being the significant financial performance factors of REITs. This study is the first attempt to test the social impact and risk mitigation hypotheses of the stakeholder theory of the corporation and the neoclassic trade-off argument to explore the association between corporate social responsibility and the market valuation of REITs. The full sample results strongly support the trade-off hypothesis, indicating that REITs’ environmental policies involve high financial costs that may drain off capital and lead to decreasing market returns. On the contrary, investors have attached a higher value to S-investing performance, especially in the post-GFC period from 2011 to 2019. A positive premium for S-investing supports the stakeholder theory as the social impact could be monetarized into a higher return and a lower systematic risk and give rise to a competitive advantage.

Druh

J_imp - Článek v periodiku v databázi Web of Science

CEP obor

—

OECD FORD obor

50206 - Finance

Projekt

—

Návaznosti

I - Institucionalni podpora na dlouhodoby koncepcni rozvoj vyzkumne organizace

Rok uplatnění

2023

Kód důvěrnosti údajů

S - Úplné a pravdivé údaje o projektu nepodléhají ochraně podle zvláštních právních předpisů

Název periodika

Environmental Science and Pollution Research

ISSN

0944-1344

e-ISSN

1614-7499

Svazek periodika

30

Číslo periodika v rámci svazku

36

Stát vydavatele periodika

DE - Spolková republika Německo

Počet stran výsledku

15

Strana od-do

85154–85169

Kód UT WoS článku

001021311100009

EID výsledku v databázi Scopus

2-s2.0-85163599120