ESG Ratings in the Corporate Reporting of DAX40 Companies in Germany: Effects on Market Participants

Marius Banke (), Stephanie Lenger and Christiane Pott
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Marius Banke: Faculty of International Accounting and Auditing, TU Dortmund University, Friedrich-Wöhler-Weg 6, 44227 Dortmund, Germany
Stephanie Lenger: Faculty of International Accounting and Auditing, TU Dortmund University, Friedrich-Wöhler-Weg 6, 44227 Dortmund, Germany
Christiane Pott: Faculty of International Accounting and Auditing, TU Dortmund University, Friedrich-Wöhler-Weg 6, 44227 Dortmund, Germany

Sustainability, 2022, vol. 14, issue 15, 1-21

Abstract: This study identifies to what extent DAX40 companies integrate ESG rating information into their reporting and whether the disclosure of ESG ratings results has a positive impact on professional and non-professional stakeholders, and thus represents a benefit for the reporting company. Our study shows that 82.5% of DAX40 companies report ESG rating results and we find that the disclosure of ESG rating results is a useful method for reporting companies (compared to non-reporters), as it leads to higher stock prices and better reputations. Considering that ESG rating results can differ substantially among different agencies, therefore, even companies with mixed ESG rating results benefit from reporting. In addition, our results support the literature that non-professional stakeholders use low-threshold information offers as an information channel. We show that companies that additionally report their ESG rating results on company websites generate higher reputation scores compared to companies that do not report their rating results on their websites.

Keywords: CSR reporting; ESG rating; reputation; disclosure; transparency; professional stakeholders; non-professional stakeholders (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2022
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