The Economic Value of Corporate Eco†Efficiency

Nadja Guenster, Rob Bauer, Jeroen Derwall and Kees Koedijk

European Financial Management, 2011, vol. 17, issue 4, 679-704

Abstract: This study adds new insights to the long†running corporate environmental†financial performance debate by focusing on the concept of eco†efficiency. Using a new database of eco†efficiency scores, we analyse the relation between eco†efficiency and financial performance from 1997 to 2004. We report that eco†efficiency relates positively to operating performance and market value. Moreover, our results suggest that the market's valuation of environmental performance has been time variant, which may indicate that the market incorporates environmental information with a drift. Although environmental leaders initially did not sell at a premium relative to laggards, the valuation differential increased significantly over time. Our results have implications for company managers, who evidently do not have to overcome a tradeoff between eco†efficiency and financial performance, and for investors, who can exploit environmental information for investment decisions.

Date: 2011
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (50)

Downloads: (external link)
https://doi.org/10.1111/j.1468-036X.2009.00532.x

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:eufman:v:17:y:2011:i:4:p:679-704

Ordering information: This journal article can be ordered from
http://www.blackwell ... bs.asp?ref=1354-7798

Access Statistics for this article

European Financial Management is currently edited by John Doukas

More articles in European Financial Management from European Financial Management Association Contact information at EDIRC.
Bibliographic data for series maintained by Wiley Content Delivery ().