Governmental and scientific news and insights on investor oriented environmental, social, and governance (ESG) data.

Female directors and real activities manipulation: Evidence from China

Unlike previous studies that focus on accrual-based earnings management, this study analyzes real activities manipulation and investigates whether female directors on boards of directors (BoDs) affect managers’ real activities manipulation. Using a large sample of 11,831 firm-year observations from Chinese listed companies from the 2000 to 2011 period, we find that higher female participation on [...]

By | 2018-03-30T13:38:20+00:00 March 30th, 2018|ESG, Gender inequality, Governance, Indicators, Risk|0 Comments

Nonfinancial Risk Disclosure & the Costs of Private Ordering

In 2016, the Securities and Exchange Commission (SEC) considered for the first time whether financial disclosure reform should address sustainability matters and other sources of nonfinancial risk. The resulting debate over these issues raises fundamental questions about how well the federal disclosure regime addresses emerging risks and about how well private ordering, through shareholder engagement, [...]

By | 2018-01-29T20:56:34+00:00 January 29th, 2018|Governments, Integrated Reporting, Risk|0 Comments

Ownership Structure and the Demand for Auditor Quality

We examine the effect of ownership structure on the demand for high quality auditors. Prior literature indicates that the demand functions for auditors may be different in private companies than in public companies due in part to more significant agency costs for public companies. Using data from publicly traded and privately owned banks of comparable [...]

By | 2017-12-03T14:30:25+00:00 December 3rd, 2017|Governance, Risk|0 Comments

UNGC Canada: Designing an anti-corruption compliance program

The 10th Principle of the UN Global Compact states, “Businesses should work against corruption in all its forms, including extortion and bribery.” Corruption, as the Global Compact recognizes, is corrosive to local communities, hinders economic development and perverts free markets. It is a driver of poverty and conflict, and is directly antithetical to the rule [...]

By | 2017-08-30T10:18:07+00:00 August 30th, 2017|Anti-corruption, Risk|0 Comments

Bank of America: ESG is the best signal we have found for future risk

Environmental, Social & Governance (ESG) factors are too critical to ignore, in our view. In our earlier report ESG: good companies can make good stocks, we found that ESG-based investing would have offered long-term equity investors substantial benefits in mitigating price risk, earnings risk and even existential risk for US stocks – ESG would have [...]

By | 2017-07-18T09:25:25+00:00 July 18th, 2017|ESG, Firm Value, Investors, Risk, Uncategorized|0 Comments

ESG Risks and the Cross-Section of Stock Returns

This paper studies the effect of ESG risks on shareholder value, using data from RepRisk to measure the risk exposure of a firm to ESG incidents. A firm has high ESG risks when it had many ESG incidents in the past. This paper shows that a portfolio of these firms generates negative stock returns over [...]

By | 2017-07-18T09:22:48+00:00 July 18th, 2017|ESG, Firm Value, Risk|0 Comments

Bloomberg and the TCFD – final recommendations

“Increasing transparency makes markets more efficient, and economies more stable and resilient.” —Michael R. Bloomberg, Chair of the TCFD To help identify the information needed by investors, lenders, and insurance underwriters to appropriately assess and price climate-related risks and opportunities for the companies, the Financial Stability Board established an industry-led task force: the Task Force [...]

By | 2017-06-29T19:12:44+00:00 June 29th, 2017|ESG, Firm Value, Indicators, Integrated Reporting, Investors, Risk|0 Comments

Two Novel Indices of Climate-Related Financial Disclosure

Market-based solutions to climate change are widely advocated by financial actors and policy-makers in order to foster a smooth transition to a low-carbon economy. A first important limiting factor to this approach is widely recognized to be the imperfect information on investors portfolio exposure to climate related risks. While better disclosure of climate-relevant information is [...]

By | 2017-06-01T09:12:55+00:00 June 1st, 2017|Financial, Firm Value, Indicators, Investors, Risk|0 Comments

Harvard: Stock Price Synchronicity and Material Sustainability Information

We examine if, and under what conditions, disclosure of sustainability information identified as investor relevant by market-driven innovations in accounting standard-setting, is associated with stock prices reflecting more firm-specific information and thereby lower synchronicity with market and industry returns. We find that firms voluntarily disclosing more sustainability information, identified as material by the Sustainability Accounting [...]

By | 2017-05-23T10:38:07+00:00 May 23rd, 2017|ESG, Firm Value, Indicators, Investors, Risk|0 Comments

EY-analysis: Is your non financial performance revealing the true value of your business to investors?

EY member firms are able to conclude from several years of research of ESG reporting that there is a global trend toward increased interest in nonfinancial information on the part of investment professionals. But the question we continue to seek to answer is whether ESG information is, ultimately, influencing investor decisions. In each of the [...]

By | 2017-05-23T10:34:49+00:00 May 23rd, 2017|ESG, Firm Value, Indicators, Investors, Risk|0 Comments