The market value of sustainable practices in the luxury industry: An identity mismatch and institutional theoretical perspective

Yunting Feng, Xun Tong and Qinghua Zhu

Transportation Research Part E: Logistics and Transportation Review, 2020, vol. 137, issue C

Abstract: Shareholders of luxury firms uphold a view of identity mismatch between being luxury and sustainable. We examine the associated market value with sustainable practice adoption of luxury firms from an institutional theoretical lens and an identity mismatch perspective. Based on 289 announcements made by public luxury firms, results from event study show that the stock market reacts negatively to the announcements of sustainable practices. Nevertheless, the negative effect attenuates in more recent year announcements, and more profitable and smaller luxury firms. Our results alert managers to better align their sustainability goals with luxury firms' identity and the ever-changing environment.

Keywords: Sustainable practices; Luxury industry; Market value; Institutional norm; Identity mismatch; Event study (search for similar items in EconPapers)
Date: 2020
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Citations: View citations in EconPapers (6)

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DOI: 10.1016/j.tre.2020.101919

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