THE ESG INDEX AND THE STOCK RETURN DURING THE PANDEMIC

Patricia Rozalia Pirvu

Proceedings of the INTERNATIONAL MANAGEMENT CONFERENCE, 2023, vol. 17, issue 1, 707-720

Abstract: The COVID-19 pandemic had a profound impact on global economic sectors, notably on stock markets. This study delves into the intricate relationship between Environmental, Social, and Governance (ESG) factors and stock market performance during this period. Investors are increasingly applying these non-financial factors as part of their analysis process to identify material risks and growth opportunities. Using a meticulous analysis of the companies listed on the S&P 500 index, we examine the influence of ESG factors on stock market returns, particularly focusing on the year 2020. The observed correlation between stock market returns and S&P 500-related ESG performance illuminates a fundamental shift in market dynamics. The statistical significance of the environmental pillar in the S&P500 during the pandemic signifies a paradigm shift in market priorities. It emphasizes the integral role of environmental sustainability in shaping investor decisions, corporate strategies, regulatory frameworks, and the overall trajectory of the financial markets. This shift has the potential to drive positive change towards a more sustainable and resilient global economy.

Keywords: environmental factors; ESG factors; pandemic; quantile regression; S&P500. (search for similar items in EconPapers)
Date: 2023
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Persistent link: https://EconPapers.repec.org/RePEc:rom:mancon:v:17:y:2023:i:1:p:707-720

DOI: 10.24818/IMC/2023/05.02

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