Does supporting Ukraine pay well? The performance of companies that suspended their business in Russia

Mahmoud Ayoub and Mahmoud Qadan

Research in International Business and Finance, 2023, vol. 66, issue C

Abstract: Using recent data about US companies that announced they were suspending their business activities in Russia following the invasion of Ukraine, we test how their decision affected their stock prices and forward-looking volatility. Using the event-study approach as well as the difference-in-difference model, we find that these firms, on average, experienced a reduction (increase) in their value (implied volatility). However, this reduction (increase) did not last more than one to two weeks. We explain the results using the classic financial paradigm and the counterbalancing impact of social responsibility. Our results are robust to a battery of robustness checks and empirical designs.

Keywords: Cash flow; Event study; Geopolitical risk; Russia; Social responsibility; Ukraine; Implied volatility (search for similar items in EconPapers)
JEL-codes: E44 G12 (search for similar items in EconPapers)
Date: 2023
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0275531923001976
Full text for ScienceDirect subscribers only

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:eee:riibaf:v:66:y:2023:i:c:s0275531923001976

DOI: 10.1016/j.ribaf.2023.102071

Access Statistics for this article

Research in International Business and Finance is currently edited by T. Lagoarde Segot

More articles in Research in International Business and Finance from Elsevier
Bibliographic data for series maintained by Catherine Liu ().