The Impact of ESG on Performance of Energy Companies from 2010 to 2020 An empirical study from US

Deng, Rui (2022) The Impact of ESG on Performance of Energy Companies from 2010 to 2020 An empirical study from US. [Dissertation (University of Nottingham only)]

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Studies about the relationship of environmental, social and governance (ESG) with corporate performance (CP) could be traced back to the beginning of 1970s. ESG has so far become one of the important criteria for the public to measure corporate social responsibility (CSR), and managers hope to find a way to help their companies stand out in today’s market competition. This study chooses the data of nine representative energy firms in the US, and examines the relation of ESG and its sub-components with corporate performance during the ten-year period from 2010 to 2020. The data is collected from Bloomberg, and multiple regressions and the robustness test are adopted to detect the association between ESG and CP.

This study breaks corporate performance into three sub-aspects: financial performance (CFP), operational performance (COP) and market performance (CMP). The regression results are partly consistent with the hypotheses. First, improving the overall ESG performance might lead to lower COP but higher CFP and CMP for the US energy firms, but none of the influence is statistically significant. Similarly, improving the environmental performance might help the US energy firms improve CFP, COP, and CMP, although the influence is not statistically significant. On the contrary, improving the social performance will significantly worsen the USA energy firms’ CFP, COP, and CMP. This result is unexpectedly opposite to the hypothesis. Improving the governance performance will help COP to some extent and the USA energy firms could also be benefited from such improvement by increasing their CMP significantly. Firms could build a more effective system to improve its governance but notice such behavior may cause a slight decline in CFP.

Item Type: Dissertation (University of Nottingham only)
Depositing User: DENG, Rui
Date Deposited: 21 Jun 2023 14:09
Last Modified: 21 Jun 2023 14:09

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