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Is sustainability important for returns?

Author

Listed:
  • Gönül Çifçi

    (Adiyaman Üniversitesi: Iktisadi ve Idari Bilimler Fakültesi)

  • Adem Ruhan Sönmez

    (Adiyaman Üniversitesi: Iktisadi ve Idari Bilimler Fakültesi)

Abstract

Sustainability is a vivid and important issue for financial markets. The financial markets discuss the sustainability’ s advantages. This study intends to reveal the nexus of sustainability risk and market returns. It is the first study that attempts to understand the sustainability’ effects on market returns. The five sub-indexes of Global Sustainable Competitiveness were used for sustainability performances. The sub-indexes are governance performance, intellectual capital, natural capital, social capital, and resource intensity. Also inflation rate and gross domestic product growth rate added the model as control variables. The dataset was from 2013 to 2020 for all G20 countries except Argentina. The results showed the all macroeconomic and sustainability factors but governance performance are important for stock market returns. Governance performance does not impact the market returns. The macroeconomic factors are more effective than sustainability factors for the returns.

Suggested Citation

  • Gönül Çifçi & Adem Ruhan Sönmez, 2023. "Is sustainability important for returns?," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 25(12), pages 15119-15137, December.
    • Handle: RePEc:spr:endesu:v:25:y:2023:i:12:d:10.1007_s10668-023-03781-1
    DOI: 10.1007/s10668-023-03781-1
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