Investor Attention to Fossil Fuel Divestment Movement and Stock Returns

Imane El Ouadghiri, Mathieu Gomes, Jonathan Peillex () and Guillaume Pijourlet
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Imane El Ouadghiri: PULV - Pôle Universitaire Léonard de Vinci, EconomiX - EconomiX - UPN - Université Paris Nanterre - CNRS - Centre National de la Recherche Scientifique
Mathieu Gomes: CleRMa - Clermont Recherche Management - ESC Clermont-Ferrand - École Supérieure de Commerce (ESC) - Clermont-Ferrand - UCA - Université Clermont Auvergne
Jonathan Peillex: LEFMI - Laboratoire d’Économie, Finance, Management et Innovation - UR UPJV 4286 - UPJV - Université de Picardie Jules Verne
Guillaume Pijourlet: CleRMa - Clermont Recherche Management - ESC Clermont-Ferrand - École Supérieure de Commerce (ESC) - Clermont-Ferrand - UCA - Université Clermont Auvergne

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Abstract: This study investigates whether the investor attention to the fossil fuel divestment (FFD) movement is related to the stock returns on firms involved in extracting fossil fuels. Three complementary indicators of investor attention to the FFD movement are considered: (1) the U.S. weekly Google Search Volume Index on the topic "fossil fuel divestment," (2) the U.S. weekly media coverage of fossil fuel divestment, and (3) the number of weekly visits to the "fossil fuel divestment" page on Wikipedia. Based on a sample of weekly returns on 1,850 U.S. firms over the period 2012-2020, our econometric estimations report a positive relationship between investor attention to FFD and excess stock returns for U.S. fossil fuel-related firms. Therefore, contrary to what the FFD campaigners might expect, the stigmatization of the fossil fuel industry does not drive down the stock returns on fossil fuel-related firms.

Keywords: Fossil fuel divestment; Fossil fuel-related firms; Investor attention; Stock returns (search for similar items in EconPapers)
Date: 2022-09-01
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Citations: View citations in EconPapers (4)

Published in Energy Journal, 2022, 43 (01), ⟨10.5547/01956574.43.6.ioua⟩

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Persistent link: https://EconPapers.repec.org/RePEc:hal:journl:hal-03969308

DOI: 10.5547/01956574.43.6.ioua

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