Stakeholder engagement: Investors' environmental risk aversion and corporate earnings

Khine Kyaw, Mojisola Olugbode and Barbara Petracci

Business Strategy and the Environment, 2022, vol. 31, issue 3, 1220-1231

Abstract: How does investors' aversion to environmental risk affect their reaction towards firms' earnings announcements? We explore this by analyzing earnings announcements made by U.S. firms between 2002 and 2016. The results show that environmental performance at the firm level is important for investors as this influences the investment behaviors of investors who have some degree of aversion to environmental risk. These investors appreciate the earnings by firms that exhibit a high level of environmental performance, i.e., firms that have successfully addressed environmental risks. However, earnings are of secondary importance for investors who are highly averse to environmental risk since environmental concerns take precedence.

Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (5)

Downloads: (external link)
https://doi.org/10.1002/bse.2951

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:bla:bstrat:v:31:y:2022:i:3:p:1220-1231

Ordering information: This journal article can be ordered from
http://onlinelibrary ... 1002/(ISSN)1099-0836

Access Statistics for this article

Business Strategy and the Environment is currently edited by Richard Welford

More articles in Business Strategy and the Environment from Wiley Blackwell
Bibliographic data for series maintained by Wiley Content Delivery ().