The effect of environmental, social and governance risks

Tarik Dogru*, Erdinc Akyildirim, Oguzhan Cepni, Ozgur Ozdemir, Abhinav Sharma, Muhammed Hasan Yilmaz

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review

22 Citations (Scopus)

Abstract

This study examines the effect of environmental, social and governance risks on firm value. We analyze the extent to which environmental, social and governance related news affect tourism firms' abnormal returns using event study methodology. The results show that environmental, social and governance related news releases do not significantly affect firm value in the short-term. We further investigate the effect of environmental, social and governance risks on the value of tourism firms during the recent pandemic utilizing difference-in-differences analysis. The results provide robust evidence that sustainable business practices provide higher resilience to pandemic-like external shocks. Also, the presence of a sustainability committee mitigates the adverse effects of environmental, social and governance risks on firm value. Theoretical and practical implications are discussed.
Original languageEnglish
Article number103432
Number of pages15
JournalAnnals of Tourism Research
Volume95
Early online date13 Jun 2022
DOIs
Publication statusPublished - 1 Jul 2022

Keywords

  • COVID-19 pandemic
  • Environmental
  • Event study methodology
  • Firm value
  • Governance
  • Social

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