by Arthur Luetkemeyer

Abstract
Over the past decade the concept of Environmental, Social, and Governance (ESG) investing has emerged to aid investors to maximize return on investments while simultaneously supporting environmentally and socially friendly methods of production and operation. In this paper I investigate the effect of the quality of sustainability reporting on ESG ratings. I utilize a sample of 100 chemical companies with ESG ratings and sustainability disclosure indexes over a 14-year time period (2007-2020) to analyze the short- and long run effects of sustainability reporting on ESG ratings. Using OLS my regression results suggest that better overall ESG disclosure as well as individual E, S, and G disclosure leads to worse ESG ratings in both the short run and the long run.

Professor Christopher Timmins, Faculty Advisor
Professor Grace Kim, Faculty Advisor

JEL Codes: M14, M40

View Thesis