Environmental, Social, and Governance Disclosure and Financial Performance: Evidence From the Rail Industry

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Author(s): İsmail Çağrı Özcan (Ankara Yıldırım Beyazıt University, Turkey)
Copyright: 2021
Pages: 10
Source title: Sustainability Reporting, Ethics, and Strategic Management Strategies for Modern Organizations
Source Author(s)/Editor(s): Ionica Oncioiu (Titu Maiorescu University, Romania), Sorinel Căpușneanu (Titu Maiorescu University, Romania), Dan Ioan Topor (1 Decembrie 1918 University, Romania)and Dana Maria (Oprea) Constantin (University of Bucharest, Romania)
DOI: 10.4018/978-1-7998-4637-6.ch015

Keywords: Business Ethics and Law / Business Science Reference / Environment & Agriculture / Sustainable Development

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Abstract

The environmental, social, and governance (ESG) disclosure performance of the companies is becoming a major criterion for significant stakeholders like shareholders, creditors, and customers. In line with the increasing interest in ESG activities, a growing respective literature emerges. Despite this evolving attraction, the ESG aspects of the transport industry in general, and the rail industry in particular remain relatively untouched except for a small body of research on airlines. This study aims at filling this gap by analyzing how the ESG disclosure performance of the rail companies affect their financial performance, which the authors measure by return on assets (ROA), return on equity (ROE), and Tobin's Q. Based on a sample of 35 rail companies from nine countries over the 2007-2017 period, the analyses show that ESG disclosure performance has a positive and statistically significant association with the ROA of the rail companies.

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Environmental, Social, and Governance Disclosure and Financial Performance: Evidence From the Rail Industry

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