<abstract xmlns="http://www.w3.org/1999/xhtml">

<p>Nowdays investors and other stakeholders increasingly consider ESG factors when making investment decisions. They were supported by numerous rating agencies that developed a large number of indices and reporting standards to facilitate the choice of the most sustainable companies from an ESG perspective. When the relationship between financial performance and sustainability was analyzed, the researchers did not reach an unanimously accepted conclusion: many studies show a positive relationship, while others show a negative one. In many studies, the relationship between ESG performance and financial performance, assessed through profitability rates was privileged. The aim of this study is to investigate if there is a relationship between ESG performance and the liquidity rates of the listed companies from emerging financial markets in European Union. The emerging markets in European Union were selected due to their attractiveness, as they offer high earning possibilities to investors. At the same time, aspects regarding the mandatory of non-financial sustainability reporting, starting from 2023, were taken into account. This will increase the comparability and homogeneity of ESG scores, but will also generate additional reporting costs, putting suplimentary pressure on companies.</p>
</abstract>

Nowdays investors and other stakeholders increasingly consider ESG factors when making investment decisions. They were supported by numerous rating agencies that developed a large number of indices and reporting standards to facilitate the choice of the most sustainable companies from an ESG perspective. When the relationship between financial performance and sustainability was analyzed, the researchers did not reach an unanimously accepted conclusion: many studies show a positive relationship, while others show a negative one. In many studies, the relationship between ESG performance and financial performance, assessed through profitability rates was privileged. The aim of this study is to investigate if there is a relationship between ESG performance and the liquidity rates of the listed companies from emerging financial markets in European Union. The emerging markets in European Union were selected due to their attractiveness, as they offer high earning possibilities to investors. At the same time, aspects regarding the mandatory of non-financial sustainability reporting, starting from 2023, were taken into account. This will increase the comparability and homogeneity of ESG scores, but will also generate additional reporting costs, putting suplimentary pressure on companies.

Analysis of the Links Between ESG Performance and Liquidity Rates for the Companies Listed on the Emerging Markets in the European Union

Studies in Business and Economics

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 3.0 License.

Nowdays investors and other stakeholders increasingly consider ESG factors when making investment decisions. They were supported by numerous rating agencies...

Analysis of the Links Between ESG Performance and Liquidity Rates for the Companies Listed on the Emerging Markets in the European Union

Pubblicato online: 11 gen 2024

Pagine: 322 - 337

DOI: https://doi.org/10.2478/sbe-2023-0061

Parole chiave
ESG performance, liquidity ratio, emerging EU markets

© 2023 Diana Elena Vasiu, published by Sciendo

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 3.0 License.

Analysis of the Links Between ESG Performance and Liquidity Rates for the Companies Listed on the Emerging Markets in the European Union

Pubblicato online: 11 gen 2024

Pagine: 322 - 337

DOI: https://doi.org/10.2478/sbe-2023-0061

Parole chiaveESG performance, liquidity ratio, emerging EU markets

© 2023 Diana Elena Vasiu, published by Sciendo

This work is licensed under the Creative Commons Attribution-NonCommercial-NoDerivatives 3.0 License.

Parole chiave
ESG performance, liquidity ratio, emerging EU markets