Walking the talk, but above all, talking the walk: Looking green for market stakeholder engagement

Abstract

In recent years, corporate environmental commitment is showing different postures going from greenwashing to undue modesty and from environmental excellence to environmental inaction. In this paper, we go a step beyond the most recent research work on the dichotomy greenwashing-brownwashing and develop a more comprehensive model that reflect more subtly four main corporate environmental strategic positions based on both firm's environmental performance and disclosure achievements. Jointly with their characterization, and adopting a question-driven approach we add to the literature on environmental disclosure-firm performance proposing an explorative research question that consider cluster membership on market firm performance under the general assumption that, at least theoretically, each of the four main corporate environmental strategic positions under analysis can result in market performance improvements. Our empirical results from a panel data of international industrial companies show very interesting and novel insights, highlighting the fact that being green is good, but above all, it is good to look green.

How to explain stock returns of utility companies from an environmental, social and corporate governance perspective

“…This outperformance is stronger in sectors where firms rely heavily on the extraction of large amounts of natural resources (Eccles et al, 2011), such as utilities. Previous research has also concluded that companies' environmental communication can be rewarded with better performance in financial markets (Amores-Salvad o et al, 2022). Although there are several studies focused on the impact of a company's ESG policy on its economic and financial performance (Abdelmotaal & Abdel-Kader, 2016;Hussain et al, 2018), there is hardly any study focused on the utilities industry considering the stock returns as a measure of market-based financial performance.…”