| dc.description.abstract | The global spotlight on Environmental, Social, and Governance (ESG) criteria in investment
decisions has intensified, given the perceived impacts on corporate performance and investor
choices. Nonetheless, Greek companies’ stock market performances have rarely been
investigated based on ESG scores. This void is filled by this research investigating the
relationship between ESG scores and firms’ stock market returns to 2023 for firms listed in the
Athens Stock Exchange (ASE) from 2017-2023. To achieve this objective, a
quantitative methodology is employed. Using ESG scores from Refinitiv’s DataStream,
monthly returns from these stocks and other companies’ sizes (market capitalization), as well
as their industry classification according to GICS; a sample of 29 Greek firms was considered
for analysis. Our findings reveal that monthly return is not significantly influenced by ESG
scores, company size and industry classifications as indicated by regression results where the R-square value is minimal. Moreover, while weak correlations have been noticed, there are
meaningful differences in average returns between high and low ESG scorers according to a t-test. Unexpectedly, Model 3 of regression analysis shows a negative relationship between ESG
scores and monthly return for those companies with extremely high ESG scores (>75 to 100),
thereby challenging belief about immediate financial gains from strong adoption of such
practices. This finding contradicts meta-analytic results that generally found positive
relationships between long-term corporate financial outcomes and ESG performance. | |
