Exploring the Impact of Sustainability, Board Characteristics, and Firm-Specifics on Firm Value: A Comparative Study of the United Kingdom and Turkey

Faozi A. Almaqtari, Tamer Elsheikh (), Omar Ikbal Tawfik and Mayada Abd El-Aziz Youssef ()
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Faozi A. Almaqtari: Department of Accounting, Faculty of Business, Economics, and Social Development, University Malaysia Trengganu (UMT), Kuala Nerus 21030, Terengganu, Malaysia
Tamer Elsheikh: Department of Accounting, Faculty of Business, Economics, and Social Development, University Malaysia Trengganu (UMT), Kuala Nerus 21030, Terengganu, Malaysia
Omar Ikbal Tawfik: Department of Accounting, College of Commerce and Business Administration, Dhofar University, P.O. Box 2509, Salalah 211, Oman
Mayada Abd El-Aziz Youssef: Accounting and Finance Department, United Arab Emirates University, Al-Ain P.O. Box 15551, United Arab Emirates

Sustainability, 2022, vol. 14, issue 24, 1-27

Abstract: The study aims to investigate the effect of several sustainability indicators on firms’ value. Panel data of 1914 observations from the UK and Turkey from 2016 to 2021 with a fixed effect model are used to estimate the results. The findings reveal that ESG indicators associate significantly with firms’ value. However, ESG indicators exhibit a stronger significant association with Tobin’s Q than stock prices and market-to-book value. This indicates that sustainability indicators are linked to the firm’s overall market value and the long-term run market valuation rather than just the stock market value. The results also reveal that while board independence, board expertise, and diversity exhibit a significant and positive association with firms’ value, board size negatively affects firms’ value. The current study provides unique contributions and comprehensive evidence based on different institutional and country sustainability enforcement statuses. It offers empirical implications for regulatory authorities and other developing countries to provide a comprehensive ESG reporting framework.

Keywords: ESG; environmental expenses; sustainability incentives; environmental team; ESG controversies; UK and Turkey (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (1)

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