ESG practices and corporate financial performance: Evidence from the airline industry during the Russian-Ukrainian war

Yao Xie (), Sang Baum Kang () and Jialin Zhao ()
Additional contact information
Yao Xie: Morningstar Inc.
Sang Baum Kang: Illinois Institute of Technology
Jialin Zhao: St. Mary''s University

Economics Bulletin, 2025, vol. 45, issue 3, 1421 - 1430

Abstract: This paper investigates the impact of Environmental, Social, and Governance (ESG) performance on airlines' financial outcomes during the Russian–Ukrainian war, employing a Difference-in-Differences (DiD) approach. We focus on the airline industry due to its competitiveness and pronounced exposure to geopolitical risks. Our DiD analysis reveals that European airlines, which are more directly affected by the conflict, experienced significantly greater post-war losses than their non-European counterparts. However, firms with higher ESG scores exhibited stronger resilience, mitigating the war's adverse effects. These findings offer novel evidence that robust ESG practices can help firms and investors navigate non-hedgeable geopolitical crises.

Keywords: ESG; Corporate Financial Performance; Financial Risk Management; Difference-in-Differences method; Russian-Ukraine War (search for similar items in EconPapers)
JEL-codes: G3 L9 (search for similar items in EconPapers)
Date: 2025-09-30
References: Add references at CitEc
Citations:

Downloads: (external link)
http://www.accessecon.com/Pubs/EB/2025/Volume45/EB-25-V45-I3-P121.pdf (application/pdf)

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:ebl:ecbull:eb-25-00164

Access Statistics for this article

More articles in Economics Bulletin from AccessEcon
Bibliographic data for series maintained by John P. Conley ().