The curvilinear and time‐lagging impact of sustainability performance on financial performance: Evidence from Germany

Nuber, Claudio; Velte, Patrick; Hörisch, Jacob

doi:10.1002/csr.1795

Cited by 56 publications

(39 citation statements)

References 87 publications

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“…CEO duality (Duality) may cause agency issues, reduce the effectiveness of the monitoring role of the board, and reduce the likelihood of approving long-term capital investment in environmental projects, leading to a decline in environmental performance (de Villiers et al, 2011;Haque, 2017 (Nuber et al, 2020). The debt ratio (Debt) is used as a proxy for idiosyncratic firm risk and is measured as total debt divided by total assets (Liao et al, 2015).…”

Section: Variables Of the Studymentioning

confidence: 99%

Board gender diversity and carbon emissions: European evidence on curvilinear relationships and critical mass

2021

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The role of European businesses in addressing environmental issues and climate change has taken center stage with the European Green Deal. With increasing attention to the effect of board gender diversity (BGD) on firms' environmental performance, the question arises whether BGD has any influence on carbon emissions.Based on legitimacy and critical mass theory, this study empirically investigates the impact of BGD on firms' carbon performance (CP), based on total carbon emissions intensity. The paper relies on two-stage least squares (2SLS) regressions with instrumental variable (IV) and a two-step generalized method of moments (GMM) system approach to analyze a cross-country sample of 3123 observations from non-financial firms in the European STOXX600 index over the 2009-2018 period. Our findings add to the growing empirical evidence twofold: (1) there is a robust linear and positive relationship between BGD and CP, whereas some indication of a U-shaped relationship is found; and (2) we find that a critical mass of at least two women directors needs to be reached to increase CP. Our research results contribute to the current discussion on sustainable corporate governance, especially in the European capital market, and have implications for researchers, business practice, and regulatory issues alike.

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Section: Variables Of the Studymentioning

confidence: 99%

Board gender diversity and carbon emissions: European evidence on curvilinear relationships and critical mass

2021

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“…They argue that once the firm reaches the level of EP that maximizes FP, further improvements of EP will necessarily result in lower FP. Whereas following Nuber, Velte, and Hörisch (2020), most empirical studies have provided evidence of a U-shaped relationship (Nuber et al, 2020, for Germany;Wang, Lu, Ye, Chau, & Zhang, 2016, for a sample of international construction corporations; Trumpp & Guenther, 2017, for an international sample of service and manufacturing firms), there is also evidence of an inverted U-shaped relationship (Han, Kim, & Yu, 2016, for Korea;Misani & Pogutz, 2015, for an international sample). Following these prior studies, we investigate the existence of a Table 8 displays ENVSCORE presents significant coefficients only in the estimation conducted with the American subsample.…”

Section: Datamentioning

confidence: 99%

Sustainable development: The stock market's view of environmental policy

2020

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This study applies panel data regression models to investigate how the stock market values the environmental policy of the firm. The empirical analysis relies on a crosscountry sample of public firms for the period between 2014 and 2017 and uses the ratings of environmental performance (EP) released by Eikon Thomson Reuters. For the first time in the related literature, the price-to-sales multiple is used to capture the assessment of the stock market towards EP. The study reveals that firms with the highest (lowest) scores of EP are quoted at significantly lower (higher) price-to-sales multiples than other firms, indicating a negative perception of the stock market towards EP. This finding is mostly driven by firms from the American region (United States and Canada). However, even in the Scandinavian region, considered as the most advanced area with regard to the concern towards environmental issues, stock market participants do not seem to have a positive view of EP. These results are robust to various checks and, particularly, to the use of the Tobin Q ratio as an alternative indicator of the stock market perceptions. The inference of this analysis suggests that the negative assessment of the stock market towards EP may constitute a deterrent for achieving more environmentally committed firms, making it difficult to accomplish the United Nations' Sustainable Development agenda.

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“…The relationship between corporate social responsibility (CSR) and corporate financial performance (CFP) has been empirically investigated for decades (Orlitzky et al, 2003;Endrikat et al, 2014). First empirical studies prove a quadratic relationship between CSR activities and CFP (Trumpp & Guenther, 2017 ;Nuber et al, 2019;Wang et al, 2008;Fujii et al, 2013). To date, this positive effect remains on an aggregated level, as research does not answer the question, for which CSR activities, IR is able to moderate the value relevance.…”

Section: Brief Literature Reviewmentioning

confidence: 99%

Social and environmental costs: the impact of accounting and analytical support on enterprises’ sustainable development in Germany and Ukraine

Sokil¹,

Zvezdov²,

Жук³

et al. 2020

EA-XXI

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The authors investigate the theoretical and methodological ability of the accounting institute to solve the problem of information support for the implementation of the national (global) sustainable development policy. This ability is demonstrated by using methods of accounting and analytical support and mathematical analysis of the quadratic correlation and regression dependence of the added value of enterprises from the value of social and environmental costs. All studies were conducted separately for micro, small, medium and large enterprises in Ukraine and Germany (2011-2019). The results are designed using the U-shaped curve which demonstrates a direct relationship between environmental costs and the added value of the company for Ukrainian enterprises and indirect one for micro and large enterprises in Germany. Social expenses show a significant inverse U-shaped relationship with the value of the company in Ukraine, but large German enterprises fall out of this list and patterns. The ability of integrated reporting to mitigate the imbalance between the added value of the enterprise (enterprise value) and social/environmental costs has been proven. It is determined that the formation and presentation of integrated reporting should be the prerogative of not only large enterprises, but also medium and small ones, and it will ultimately lead to the sustainable development of the region, industry, and country.

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The curvilinear and time‐lagging impact of sustainability performance on financial performance: Evidence from Germany

Cited by 56 publications

References 87 publications

Board gender diversity and carbon emissions: European evidence on curvilinear relationships and critical mass

Board gender diversity and carbon emissions: European evidence on curvilinear relationships and critical mass

Sustainable development: The stock market's view of environmental policy

Social and environmental costs: the impact of accounting and analytical support on enterprises’ sustainable development in Germany and Ukraine

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