This paper investigates the relationship between positive Environmental, Social, and Governance (ESG) scores and corporate bankruptcy risk while considering various influencing factors. Our analysis reveals a nuanced but noteworthy negative correlation, with a maximum coefficient of -0.01. We meticulously account for confounding variables, including geography, sector, and the substantial impact of the 2020 pandemic on corporate bankruptcies. The findings suggest that firms with higher ESG scores may exhibit greater resilience during economic downturns, possibly due to enhanced stakeholder engagement practices. Additionally, a compelling connection emerges between company size and ESG performance, with larger enterprises demonstrating superior ESG credentials, likely driven by their increased resource base and opportunities.
Bankruptcy of listed companies and ESG scores
TRON ALBERTO;
2023-01-01
Abstract
This paper investigates the relationship between positive Environmental, Social, and Governance (ESG) scores and corporate bankruptcy risk while considering various influencing factors. Our analysis reveals a nuanced but noteworthy negative correlation, with a maximum coefficient of -0.01. We meticulously account for confounding variables, including geography, sector, and the substantial impact of the 2020 pandemic on corporate bankruptcies. The findings suggest that firms with higher ESG scores may exhibit greater resilience during economic downturns, possibly due to enhanced stakeholder engagement practices. Additionally, a compelling connection emerges between company size and ESG performance, with larger enterprises demonstrating superior ESG credentials, likely driven by their increased resource base and opportunities.I documenti in IRIS sono protetti da copyright e tutti i diritti sono riservati, salvo diversa indicazione.
