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Do investors value corporate sustainability structures? Evidence from the cost of equity capital

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  • El Guengue, Hayat
  • Hmaittane, Abdelmajid
  • Bouslah, Kais
  • M’Zali, Bouchra

Abstract

This paper studies the impact of the level and structure of firms’ sustainability activities on the cost of equity financing. We argue that diversified and specialized sustainability structures have different effects on the link between the corporate sustainability level and the cost of equity capital. Our findings show that firms with high levels of sustainability activities and/or diversified sustainability structures have significantly lower equity costs. These results have important implications for researchers, investors, and portfolio managers.

Suggested Citation

  • El Guengue, Hayat & Hmaittane, Abdelmajid & Bouslah, Kais & M’Zali, Bouchra, 2025. "Do investors value corporate sustainability structures? Evidence from the cost of equity capital," Finance Research Letters, Elsevier, vol. 85(PE).
    • Handle: RePEc:eee:finlet:v:85:y:2025:i:pe:s154461232501462x
    DOI: 10.1016/j.frl.2025.108207
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    References listed on IDEAS

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