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ESG Resilience during the COVID-19 Pandemic: Evidence from America

February 17, 2023 @ 12:15 - 13:30

Presentation abstract:

The relationship between a company’s ESG (environmental, social, governance) attributes and its stock performance has been quite debatable. Through an empirical study, we investigate high ESG stocks’ resilience to the market turmoil during the COVID-19 pandemic by examining firms’ ESG financial performance. Our results suggest that high ESG stocks generated more abnormal returns than low ESG stocks during the whole pandemic year. A closer look at the data reveals considerable heterogeneity of the relative performance of high ESG stocks depending on the development phase of the COVID-19 pandemic and subcategories of ESG factors. Thus, when market uncertainty increases, investors could gain resilience of their assets from high ESG firms. We try to explore the mechanism behind these findings using investor sentiments. Meanwhile, to have a comprehensive understanding of the true underlying mechanism for investors’ socially responsible investment, we investigate investors’ beliefs, risk perceptions, and ambiguity perceptions towards an ESG fund in an incentivized lab experiment. We find that knowing the high ESG rating increased subjects’ return expectations, which is the opposite of what has been found in widely used unincentivized survey studies. Moreover, the high ESG rating made subjects more conservative when updating on negative information and perceived lower ambiguity and risk. This suggests that the unincentivized elicitation of ESG-related beliefs could be systematically biased.



Bin Dong


BinDong’s interdisciplinary research unites two strands of recent, significant Finance inquiry: behavioural finance and sustainable finance. His research focuses on asset pricing and investors’ motives, including beliefs and preferences, especially employing empirical and experimental (lab and field) methodologies. His current research centers on ESG performance evaluation and investors’ beliefs towards SRI (socially responsible investment) and divestment and engagement. Besides academic experience, Bin Dong has over ten years of consulting industry experience. Under the direction of Rob Bauer, Bin is completing his Ph.D. in sustainable finance at Maastricht University with an expected degree date of August 2023.



Dr. Niccoló Nirino


February 17, 2023
12:15 - 13:30


Dr. Niccolò Nirino + Bin Dong (Ph.D. student, Maastricht University)


Aula Jona, Department of Management of the University of Turin
Corso Unione Sovietica, 218bis
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