The influence of esg factors on the market capitalization of Russian companies

Abstract

Investment analysis of companies using sustainable development criteria, ESG principles, is aimed at priority selection of companies with optimal environmental, social and managerial characteristics. There are discussions among foreign authors researching securities markets about the degree of influence of these factors on the market capitalization of companies, while there are polar opinions. in domestic practice, there is an increase in interest in ESG principles, both at the legislative level and at the level of corporate businesses, banks and rating agencies, however, a study on the impact of these principles on the value indicators of company shares is only being formed. in this paper, an attempt is made to build a relationship between the market value of Russian companies from various industries and their financial and non-financial information for the period 2018-2021. the source of the assessment of the effectiveness of environmental, social and managerial policies of Russian companies was the data of the rating agency "Expert Ra" and the financial indicators of the companies. the research revealed an inverse relationship between the company's market capitalization and effective ESG policy. Optimal ESG results, according to the research of the authors of this article, on average are a positive signal for companies with state participation, but negative results have been obtained for companies belonging to industries sensitive to environmental problems.