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The Stock Market Reaction to Green Bond Issuance: A Study Based on a Multidimensional Scaling Approach

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  • Wided Khiari

    (GEF2A Laboratory, Institut Supérieur de Gestion de Tunis, University of Tunis, Tunis Q5V7+P4W, Tunisia)

  • Ines Ben Flah

    (GEF2A Laboratory, Institut Supérieur de Gestion de Tunis, University of Tunis, Tunis Q5V7+P4W, Tunisia)

  • Azhaar Lajmi

    (GEF2A Laboratory, Institut Supérieur de Gestion de Tunis, University of Tunis, Tunis Q5V7+P4W, Tunisia)

  • Fida Bouhleli

    (GEF2A Laboratory, Institut Supérieur de Gestion de Tunis, University of Tunis, Tunis Q5V7+P4W, Tunisia)

Abstract

The aim of this study is to examine the impact of green bond issuance on the stock market, based on the share prices of 29 companies located in different countries around the world. Using our financial map and applying clustering techniques, we study price fluctuations and identify the influences shaping them. Our contribution lies in methodological innovation through a Multidimensional Scaling approach. Based on this innovative approach, the results of this investigation revealed a complex dynamic in which various factors such as company size, issue volume, total number of issues, geographical location, country GDP, and even governance indices such as the corruption index interact significantly.

Suggested Citation

  • Wided Khiari & Ines Ben Flah & Azhaar Lajmi & Fida Bouhleli, 2024. "The Stock Market Reaction to Green Bond Issuance: A Study Based on a Multidimensional Scaling Approach," JRFM, MDPI, vol. 17(9), pages 1-34, September.
    • Handle: RePEc:gam:jjrfmx:v:17:y:2024:i:9:p:408-:d:1475439
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    References listed on IDEAS

    as
    1. Jinyu Chen & Yan Yang & Ran Liu & Yuan Geng & Xiaohang Ren, 2023. "Green bond issuance and corporate ESG performance: the perspective of internal attention and external supervision," Palgrave Communications, Palgrave Macmillan, vol. 10(1), pages 1-12, December.
    2. Giovanna Michelon & Antonio Parbonetti, 2012. "The effect of corporate governance on sustainability disclosure," Journal of Management & Governance, Springer;Accademia Italiana di Economia Aziendale (AIDEA), vol. 16(3), pages 477-509, August.
    3. Caramichael, John & Rapp, Andreas C., 2024. "The green corporate bond issuance premium," Journal of Banking & Finance, Elsevier, vol. 162(C).
    4. Jensen, Michael C. & Meckling, William H., 1976. "Theory of the firm: Managerial behavior, agency costs and ownership structure," Journal of Financial Economics, Elsevier, vol. 3(4), pages 305-360, October.
    5. Joseph E. Stiglitz, 2000. "The Contributions of the Economics of Information to Twentieth Century Economics," The Quarterly Journal of Economics, President and Fellows of Harvard College, vol. 115(4), pages 1441-1478.
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